PCYO Long Put Strategy
PCYO (Pure Cycle Corporation), in the Utilities sector, (Regulated Water industry), listed on NASDAQ.
Pure Cycle Corporation designs, constructs, operates, and maintains water and wastewater systems in the Denver metropolitan area and Colorado Front Range in the United States. It operates in two segments, Wholesale Water and Wastewater Services, and Land Development. The company engages in the wholesale water production, storage, treatment, and distribution systems; wastewater collection and treatment systems; development of master-planned community; and oil and gas leasing business. It serves domestic, commercial, and industrial customers in the Denver metropolitan region. Pure Cycle Corporation was founded in 1976 and is based in Watkins, Colorado.
PCYO (Pure Cycle Corporation) trades in the Utilities sector, specifically Regulated Water, with a market capitalization of approximately $268.5M, a trailing P/E of 19.13, a beta of 1.29 versus the broader market, a 52-week range of 9.65-12.44, average daily share volume of 56K, a public-listing history dating back to 1994, approximately 39 full-time employees. These structural characteristics shape how PCYO stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.29 places PCYO roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a long put on PCYO?
A long put buys downside exposure with a fixed maximum loss equal to the premium paid; profit accrues if the underlying closes below the strike minus premium at expiration.
Current PCYO snapshot
As of May 15, 2026, spot at $10.54, ATM IV 346.80%, IV rank 91.70%, expected move 99.42%. The long put on PCYO below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 34-day expiry.
Why this long put structure on PCYO specifically: PCYO IV at 346.80% is rich versus its 1-year range, which makes a premium-buying PCYO long put relatively expensive in absolute-cost terms, with a market-implied 1-standard-deviation move of approximately 99.42% (roughly $10.48 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated PCYO expiries trade a higher absolute premium for lower per-day decay. Position sizing on PCYO should anchor to the underlying notional of $10.54 per share and to the trader's directional view on PCYO stock.
PCYO long put setup
The PCYO long put below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With PCYO near $10.54, the first option leg uses a $10.54 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PCYO chain at a 34-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 PCYO shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Put | $10.54 | N/A |
PCYO long put risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
Max profit equals the strike minus premium times 100 (reached at zero); max loss equals the premium times 100. Breakeven is strike minus premium.
PCYO long put payoff curve
Modeled P&L at expiration across a range of underlying prices for the long put on PCYO. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
When traders use long put on PCYO
Long puts on PCYO hedge an existing long PCYO stock position or express a bearish view with defined risk; position sizing typically scales the put notional to the underlying PCYO exposure being hedged.
PCYO thesis for this long put
The market-implied 1-standard-deviation range for PCYO extends from approximately $0.06 on the downside to $21.02 on the upside. A PCYO long put expresses a directional view that the underlying closes below the strike minus premium at expiration, frequently sized to hedge an existing long PCYO position with one put per 100 shares held. Current PCYO IV rank near 91.70% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on PCYO at 346.80%. As a Utilities name, PCYO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PCYO-specific events.
PCYO long put positions are structurally bearish; the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. PCYO positions also carry Utilities sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PCYO alongside the broader basket even when PCYO-specific fundamentals are unchanged. Long-premium structures like a long put on PCYO are particularly exposed to IV-crush risk through scheduled events (earnings, FDA decisions, central-bank meetings) where IV typically contracts post-event regardless of the directional outcome. Always rebuild the position from current PCYO chain quotes before placing a trade.
Frequently asked questions
- What is a long put on PCYO?
- A long put on PCYO is the long put strategy applied to PCYO (stock). The strategy is structurally bearish: A long put buys downside exposure with a fixed maximum loss equal to the premium paid; profit accrues if the underlying closes below the strike minus premium at expiration. With PCYO stock trading near $10.54, the strikes shown on this page are snapped to the nearest listed PCYO chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PCYO long put max profit and max loss calculated?
- Max profit equals the strike minus premium times 100 (reached at zero); max loss equals the premium times 100. Breakeven is strike minus premium. For the PCYO long put priced from the end-of-day chain at a 30-day expiry (ATM IV 346.80%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a PCYO long put?
- The breakeven for the PCYO long put priced on this page is no defined breakeven on the modeled curve at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current PCYO market-implied 1-standard-deviation expected move is approximately 99.42%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a long put on PCYO?
- Long puts on PCYO hedge an existing long PCYO stock position or express a bearish view with defined risk; position sizing typically scales the put notional to the underlying PCYO exposure being hedged.
- How does current PCYO implied volatility affect this long put?
- PCYO ATM IV is at 346.80% with IV rank near 91.70%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.