RDN Long Call Strategy
RDN (Radian Group Inc.), in the Financial Services sector, (Insurance - Specialty industry), listed on NYSE.
Operating across the United States, Radian Group Inc. and its various subsidiaries are key players in the mortgage and real estate services sector. Through its Mortgage segment, the company delivers crucial credit-related insurance, predominantly private mortgage insurance for primary residential loans. This division also furnishes a suite of credit risk management, contract underwriting, and fulfillment services. Its principal clientele includes a broad spectrum of mortgage originators, ranging from large mortgage and commercial banks to savings institutions, credit unions, and community banks. Radian's Homegenius segment provides an extensive array of services. These encompass comprehensive title services, such as both insured and uninsured title solutions, tax and title data management, centralized document recording, retrieval, and default curative actions, along with deed and property reports.
RDN (Radian Group Inc.) trades in the Financial Services sector, specifically Insurance - Specialty, with a market capitalization of approximately $4.99B, a trailing P/E of 9.14, a beta of 0.74 versus the broader market, a 52-week range of 31.5-38.84, average daily share volume of 1.2M, a public-listing history dating back to 1992, approximately 1K full-time employees. These structural characteristics shape how RDN stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.74 places RDN roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 9.14 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. RDN pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a long call on RDN?
A long call buys upside exposure with a fixed maximum loss equal to the premium paid; profit accrues if the underlying closes above the strike plus premium at expiration.
Current RDN snapshot
As of June 30, 2026, spot at $37.78, ATM IV 19.60%, IV rank 2.15%, expected move 5.62%. The long call on RDN 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 52-day expiry.
Why this long call structure on RDN specifically: RDN IV at 19.60% is on the cheap side of its 1-year range, which favors premium-buying structures like a RDN long call, with a market-implied 1-standard-deviation move of approximately 5.62% (roughly $2.12 on the underlying). The 52-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated RDN expiries trade a higher absolute premium for lower per-day decay. Position sizing on RDN should anchor to the underlying notional of $37.78 per share and to the trader's directional view on RDN stock.
RDN long call setup
The RDN long call below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With RDN near $37.78, the first option leg uses a $38.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed RDN chain at a 52-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 RDN shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $38.00 | $1.55 |
RDN long call risk and reward
- Net Premium / Debit
- -$155.00
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- -$155.00
- Breakeven(s)
- $39.55
- Risk / Reward Ratio
- Unbounded
Max profit is unbounded; max loss equals the premium paid times 100. Breakeven is strike plus premium.
RDN long call payoff curve
Modeled P&L at expiration across a range of underlying prices for the long call on RDN. 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.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | -$155.00 |
| $8.36 | -77.9% | -$155.00 |
| $16.71 | -55.8% | -$155.00 |
| $25.07 | -33.7% | -$155.00 |
| $33.42 | -11.5% | -$155.00 |
| $41.77 | +10.6% | +$222.13 |
| $50.12 | +32.7% | +$1,057.36 |
| $58.48 | +54.8% | +$1,892.58 |
| $66.83 | +76.9% | +$2,727.81 |
| $75.18 | +99.0% | +$3,563.04 |
When traders use long call on RDN
Long calls on RDN express a bullish thesis with defined risk; traders use them ahead of RDN catalysts (earnings, product launches, macro events) when the expected upside justifies the premium and theta decay.
RDN thesis for this long call
The market-implied 1-standard-deviation range for RDN extends from approximately $35.66 on the downside to $39.90 on the upside. A RDN long call expresses a directional view that the underlying closes above the strike plus premium at expiration, ideally with implied volatility holding or expanding to preserve extrinsic value through the hold period. Current RDN IV rank near 2.15% 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 RDN at 19.60%. As a Financial Services name, RDN options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RDN-specific events.
RDN long call positions are structurally bullish; 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. RDN positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move RDN alongside the broader basket even when RDN-specific fundamentals are unchanged. Long-premium structures like a long call on RDN 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 RDN chain quotes before placing a trade.
Frequently asked questions
- What is a long call on RDN?
- A long call on RDN is the long call strategy applied to RDN (stock). The strategy is structurally bullish: A long call buys upside exposure with a fixed maximum loss equal to the premium paid; profit accrues if the underlying closes above the strike plus premium at expiration. With RDN stock trading near $37.78, the strikes shown on this page are snapped to the nearest listed RDN chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are RDN long call max profit and max loss calculated?
- Max profit is unbounded; max loss equals the premium paid times 100. Breakeven is strike plus premium. For the RDN long call priced from the end-of-day chain at a 30-day expiry (ATM IV 19.60%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$155.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a RDN long call?
- The breakeven for the RDN long call priced on this page is roughly $39.55 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 RDN market-implied 1-standard-deviation expected move is approximately 5.62%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a long call on RDN?
- Long calls on RDN express a bullish thesis with defined risk; traders use them ahead of RDN catalysts (earnings, product launches, macro events) when the expected upside justifies the premium and theta decay.
- How does current RDN implied volatility affect this long call?
- RDN ATM IV is at 19.60% with IV rank near 2.15%, 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.