RDVT Bull Call Spread Strategy
RDVT (Red Violet, Inc.), in the Technology sector, (Software - Application industry), listed on NASDAQ.
Red Violet, Inc. is a technology firm specializing in software and analytical services, leveraging its proprietary technology and advanced analytical prowess to deliver crucial identity intelligence solutions primarily within the United States. Among its flagship offerings is idiCORE, an investigative platform designed to tackle diverse corporate hurdles, including rigorous due diligence, proactive risk mitigation, robust identity verification, and adherence to regulatory mandates. Additionally, FOREWARN, an intuitive app-based tool, empowers professionals with immediate insights prior to in-person consumer interactions, thereby enabling them to promptly identify and reduce potential risks. Red Violet's client base spans a broad spectrum of industries, encompassing financial services, insurance, healthcare, retail, and telecommunications, alongside law enforcement bodies, government agencies, collections services, corporate security departments, and investigative organizations. Their solutions are instrumental in objectives such as comprehensive risk reduction, thorough due diligence, the prevention and detection of fraud, ensuring regulatory adherence, and facilitating strategic customer acquisition. The company employs a multi-faceted go-to-market strategy, engaging value-added distributors, resellers, and strategic alliances.
RDVT (Red Violet, Inc.) trades in the Technology sector, specifically Software - Application, with a market capitalization of approximately $850.5M, a trailing P/E of 60.68, a beta of 1.85 versus the broader market, a 52-week range of 33.4-64.135, average daily share volume of 155K, a public-listing history dating back to 2018, approximately 215 full-time employees. These structural characteristics shape how RDVT stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.85 indicates RDVT has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. The trailing P/E of 60.68 is on the rich side, which tends to correlate with higher earnings-window IV expansion as the market debates whether forward growth supports the multiple. RDVT pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a bull call spread on RDVT?
A bull call spread buys an at-the-money call and sells an out-of-the-money call at a higher strike for defined risk and defined reward bounded by the strike width.
Current RDVT snapshot
As of June 30, 2026, spot at $63.86, ATM IV 38.00%, IV rank 2.45%, expected move 10.89%. The bull call spread on RDVT 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 17-day expiry.
Why this bull call spread structure on RDVT specifically: RDVT IV at 38.00% is on the cheap side of its 1-year range, which favors premium-buying structures like a RDVT bull call spread, with a market-implied 1-standard-deviation move of approximately 10.89% (roughly $6.96 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated RDVT expiries trade a higher absolute premium for lower per-day decay. Position sizing on RDVT should anchor to the underlying notional of $63.86 per share and to the trader's directional view on RDVT stock.
RDVT bull call spread setup
The RDVT bull call spread below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With RDVT near $63.86, the first option leg uses a $63.86 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed RDVT chain at a 17-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 RDVT shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $63.86 | N/A |
| Sell 1 | Call | $67.05 | N/A |
RDVT bull call spread 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 strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-call strike plus net debit.
RDVT bull call spread payoff curve
Modeled P&L at expiration across a range of underlying prices for the bull call spread on RDVT. 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 bull call spread on RDVT
Bull call spreads on RDVT reduce the cost of a bullish RDVT stock position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.
RDVT thesis for this bull call spread
The market-implied 1-standard-deviation range for RDVT extends from approximately $56.90 on the downside to $70.82 on the upside. A RDVT bull call spread caps both the risk and the reward of a bullish position; relative to an outright long call on RDVT, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current RDVT IV rank near 2.45% 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 RDVT at 38.00%. As a Technology name, RDVT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RDVT-specific events.
RDVT bull call spread positions are structurally moderately 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. RDVT positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move RDVT alongside the broader basket even when RDVT-specific fundamentals are unchanged. Long-premium structures like a bull call spread on RDVT 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 RDVT chain quotes before placing a trade.
Frequently asked questions
- What is a bull call spread on RDVT?
- A bull call spread on RDVT is the bull call spread strategy applied to RDVT (stock). The strategy is structurally moderately bullish: A bull call spread buys an at-the-money call and sells an out-of-the-money call at a higher strike for defined risk and defined reward bounded by the strike width. With RDVT stock trading near $63.86, the strikes shown on this page are snapped to the nearest listed RDVT chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are RDVT bull call spread max profit and max loss calculated?
- Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-call strike plus net debit. For the RDVT bull call spread priced from the end-of-day chain at a 30-day expiry (ATM IV 38.00%), 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 RDVT bull call spread?
- The breakeven for the RDVT bull call spread 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 RDVT market-implied 1-standard-deviation expected move is approximately 10.89%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a bull call spread on RDVT?
- Bull call spreads on RDVT reduce the cost of a bullish RDVT stock position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.
- How does current RDVT implied volatility affect this bull call spread?
- RDVT ATM IV is at 38.00% with IV rank near 2.45%, 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.