RXRX Strangle Strategy
RXRX (Recursion Pharmaceuticals, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Recursion Pharmaceuticals, Inc. operates as a biotechnology firm currently in its clinical development phase. The company's mission is to revolutionize drug discovery by decoding biological processes, utilizing an integrated approach that combines technological innovations across biology, chemistry, automation, data science, and engineering. Their developmental pipeline features several clinical-stage compounds: REC-994, which is advancing through Phase IIa trials for cerebral cavernous malformation; REC-3599, currently in Phase I trials for GM2 gangliosidosis; REC-2282, aimed at treating neurofibromatosis type 2; and REC-4881, intended for familial adenomatous polyposis. Beyond these, Recursion maintains a comprehensive preclinical portfolio. This includes REC-3964 for Clostridium difficile colitis, REC-64917 targeting neural or systemic inflammation, and REC-65029 for HRD-negative ovarian cancer. Further preclinical candidates are REC-648918, designed to enhance anti-tumor immunity; REC-2029 for wnt-mutant hepatocellular carcinoma; REC-14221 for various solid and hematological malignancies; and REC-64151, focused on addressing immune checkpoint resistance in KRAS/STK11 mutant non-small cell lung cancer.
RXRX (Recursion Pharmaceuticals, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $1.57B, a beta of 1.00 versus the broader market, a 52-week range of 2.77-7.18, average daily share volume of 16.3M, a public-listing history dating back to 2021, approximately 800 full-time employees. These structural characteristics shape how RXRX stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.00 places RXRX roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a strangle on RXRX?
A long strangle buys an OTM call and an OTM put at offset strikes, cheaper than a straddle but requiring a larger underlying move to profit since both wings start out-of-the-money.
Current RXRX snapshot
As of June 30, 2026, spot at $3.67, ATM IV 81.93%, IV rank 21.15%, expected move 23.49%. The strangle on RXRX 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 31-day expiry.
Why this strangle structure on RXRX specifically: RXRX IV at 81.93% is on the cheap side of its 1-year range, which favors premium-buying structures like a RXRX strangle, with a market-implied 1-standard-deviation move of approximately 23.49% (roughly $0.86 on the underlying). The 31-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated RXRX expiries trade a higher absolute premium for lower per-day decay. Position sizing on RXRX should anchor to the underlying notional of $3.67 per share and to the trader's directional view on RXRX stock.
RXRX strangle setup
The RXRX strangle below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With RXRX near $3.67, the first option leg uses a $3.85 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed RXRX chain at a 31-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 RXRX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $3.85 | N/A |
| Buy 1 | Put | $3.49 | N/A |
RXRX strangle 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 put strike minus the combined debit (reached at zero). Max loss equals the combined debit times 100 (reached anywhere between the two OTM strikes). Two breakevens at call-strike plus debit and put-strike minus debit.
RXRX strangle payoff curve
Modeled P&L at expiration across a range of underlying prices for the strangle on RXRX. 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 strangle on RXRX
Strangles on RXRX are the cheaper cousin of the straddle - traders use them when they want a large directional move but are willing to give up the inner-strike sensitivity in exchange for a lower up-front debit on the RXRX chain.
RXRX thesis for this strangle
The market-implied 1-standard-deviation range for RXRX extends from approximately $2.81 on the downside to $4.53 on the upside. A RXRX long strangle is the OTM cousin of the straddle: lower up-front cost but the underlying has to travel further past either OTM strike before the position turns profitable at expiration. Current RXRX IV rank near 21.15% 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 RXRX at 81.93%. As a Healthcare name, RXRX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RXRX-specific events.
RXRX strangle positions are structurally neutral / high-volatility (long premium, OTM); 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. RXRX positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move RXRX alongside the broader basket even when RXRX-specific fundamentals are unchanged. Always rebuild the position from current RXRX chain quotes before placing a trade.
Frequently asked questions
- What is a strangle on RXRX?
- A strangle on RXRX is the strangle strategy applied to RXRX (stock). The strategy is structurally neutral / high-volatility (long premium, OTM): A long strangle buys an OTM call and an OTM put at offset strikes, cheaper than a straddle but requiring a larger underlying move to profit since both wings start out-of-the-money. With RXRX stock trading near $3.67, the strikes shown on this page are snapped to the nearest listed RXRX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are RXRX strangle max profit and max loss calculated?
- Upside max profit is unbounded; downside max profit is bounded at the put strike minus the combined debit (reached at zero). Max loss equals the combined debit times 100 (reached anywhere between the two OTM strikes). Two breakevens at call-strike plus debit and put-strike minus debit. For the RXRX strangle priced from the end-of-day chain at a 30-day expiry (ATM IV 81.93%), 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 RXRX strangle?
- The breakeven for the RXRX strangle 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 RXRX market-implied 1-standard-deviation expected move is approximately 23.49%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a strangle on RXRX?
- Strangles on RXRX are the cheaper cousin of the straddle - traders use them when they want a large directional move but are willing to give up the inner-strike sensitivity in exchange for a lower up-front debit on the RXRX chain.
- How does current RXRX implied volatility affect this strangle?
- RXRX ATM IV is at 81.93% with IV rank near 21.15%, 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.