PFS Straddle Strategy
PFS (Provident Financial Services, Inc.), in the Financial Services sector, (Banks - Regional industry), listed on NYSE.
Provident Financial Services, Inc. operates as the bank holding company for Provident Bank that provides various banking products and services to individuals, families, and businesses in the United States. The company's deposit products include savings, checking, interest-bearing checking, money market deposit, and certificate of deposit accounts, as well as IRA products. Its loan portfolio comprises commercial real estate loans that are secured by properties, such as multi-family apartment buildings, office buildings, and retail and industrial properties; commercial business loans; fixed-rate and adjustable-rate mortgage loans collateralized by one- to four-family residential real estate properties; commercial construction loans; and consumer loans consisting of home equity loans, home equity lines of credit, marine loans, personal loans and unsecured lines of credit, and auto and recreational vehicle loans. The company also offers cash management, remote deposit capture, payroll origination, escrow account management, and online and mobile banking services; and business credit cards. In addition, it provides wealth management services comprising investment management, trust and estate administration, financial planning, tax compliance and planning, and private banking. Further, the company sells insurance and investment products, including annuities; operates as a real estate investment trust for acquiring mortgage loans and other real estate related assets; and manages and sells real estate properties acquired through foreclosure.
PFS (Provident Financial Services, Inc.) trades in the Financial Services sector, specifically Banks - Regional, with a market capitalization of approximately $2.84B, a trailing P/E of 9.26, a beta of 0.80 versus the broader market, a 52-week range of 15.92-23.98, average daily share volume of 1.1M, a public-listing history dating back to 2003, approximately 2K full-time employees. These structural characteristics shape how PFS stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.80 places PFS roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 9.26 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. PFS pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a straddle on PFS?
A long straddle buys an ATM call and an ATM put at the same strike, profiting from a large move in either direction; max loss equals the combined debit when the underlying pins to the strike at expiration.
Current PFS snapshot
As of May 15, 2026, spot at $21.52, ATM IV 48.60%, IV rank 18.22%, expected move 13.93%. The straddle on PFS 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 straddle structure on PFS specifically: PFS IV at 48.60% is on the cheap side of its 1-year range, which favors premium-buying structures like a PFS straddle, with a market-implied 1-standard-deviation move of approximately 13.93% (roughly $3.00 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 PFS expiries trade a higher absolute premium for lower per-day decay. Position sizing on PFS should anchor to the underlying notional of $21.52 per share and to the trader's directional view on PFS stock.
PFS straddle setup
The PFS straddle below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With PFS near $21.52, the first option leg uses a $21.52 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PFS 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 PFS shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $21.52 | N/A |
| Buy 1 | Put | $21.52 | N/A |
PFS straddle 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
Upside max profit is unbounded; downside max profit is bounded at the strike minus the combined call plus put debit (reached at zero). Max loss equals the combined debit times 100 (reached when the underlying pins to the strike). Two breakevens at strike plus debit and strike minus debit.
PFS straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on PFS. 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 straddle on PFS
Straddles on PFS are pure-volatility plays that profit from large moves in either direction; traders typically buy PFS straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
PFS thesis for this straddle
The market-implied 1-standard-deviation range for PFS extends from approximately $18.52 on the downside to $24.52 on the upside. A PFS long straddle is a pure-volatility play: it profits when the underlying moves far enough from the strike in either direction to overcome the combined call plus put debit, regardless of direction. Current PFS IV rank near 18.22% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on PFS at 48.60%. As a Financial Services name, PFS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PFS-specific events.
PFS straddle positions are structurally neutral / high-volatility (long premium); 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. PFS positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PFS alongside the broader basket even when PFS-specific fundamentals are unchanged. Always rebuild the position from current PFS chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on PFS?
- A straddle on PFS is the straddle strategy applied to PFS (stock). The strategy is structurally neutral / high-volatility (long premium): A long straddle buys an ATM call and an ATM put at the same strike, profiting from a large move in either direction; max loss equals the combined debit when the underlying pins to the strike at expiration. With PFS stock trading near $21.52, the strikes shown on this page are snapped to the nearest listed PFS chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PFS straddle max profit and max loss calculated?
- Upside max profit is unbounded; downside max profit is bounded at the strike minus the combined call plus put debit (reached at zero). Max loss equals the combined debit times 100 (reached when the underlying pins to the strike). Two breakevens at strike plus debit and strike minus debit. For the PFS straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 48.60%), 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 PFS straddle?
- The breakeven for the PFS straddle 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 PFS market-implied 1-standard-deviation expected move is approximately 13.93%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on PFS?
- Straddles on PFS are pure-volatility plays that profit from large moves in either direction; traders typically buy PFS straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
- How does current PFS implied volatility affect this straddle?
- PFS ATM IV is at 48.60% with IV rank near 18.22%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.