SGMT Straddle Strategy

SGMT (Sagimet Biosciences Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.

Sagimet Biosciences Inc., a clinical-stage biopharmaceutical company, develops therapeutics called fatty acid synthase (FASN) inhibitors for the treatment of diseases that result from dysfunctional lipid metabolism pathways. Its lead drug candidate is Denifanstat, a FASN inhibitor for the treatment of nonalcoholic steatohepatitis and acne. The company is also developing TVB-3567, a FASN inhibitor for the treatment of various types of cancers. The company was formerly known as 3-V Biosciences, Inc. and changed its name to Sagimet Biosciences Inc. in August 2019. Sagimet Biosciences Inc. was incorporated in 2006 and is headquartered in San Mateo, California.

SGMT (Sagimet Biosciences Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $247.6M, a beta of 3.64 versus the broader market, a 52-week range of 3.08-11.41, average daily share volume of 1.4M, a public-listing history dating back to 2023, approximately 14 full-time employees. These structural characteristics shape how SGMT stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 3.64 indicates SGMT has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.

What is a straddle on SGMT?

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 SGMT snapshot

As of May 15, 2026, spot at $6.92, ATM IV 85.10%, IV rank 8.25%, expected move 24.40%. The straddle on SGMT 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 SGMT specifically: SGMT IV at 85.10% is on the cheap side of its 1-year range, which favors premium-buying structures like a SGMT straddle, with a market-implied 1-standard-deviation move of approximately 24.40% (roughly $1.69 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 SGMT expiries trade a higher absolute premium for lower per-day decay. Position sizing on SGMT should anchor to the underlying notional of $6.92 per share and to the trader's directional view on SGMT stock.

SGMT straddle setup

The SGMT 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 SGMT near $6.92, the first option leg uses a $6.92 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed SGMT 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 SGMT shares for the stock leg in covered calls and collars).

ActionTypeStrike / BasisPremium (est)
Buy 1Call$6.92N/A
Buy 1Put$6.92N/A

SGMT 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.

SGMT straddle payoff curve

Modeled P&L at expiration across a range of underlying prices for the straddle on SGMT. 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 SGMT

Straddles on SGMT are pure-volatility plays that profit from large moves in either direction; traders typically buy SGMT straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.

SGMT thesis for this straddle

The market-implied 1-standard-deviation range for SGMT extends from approximately $5.23 on the downside to $8.61 on the upside. A SGMT 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 SGMT IV rank near 8.25% 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 SGMT at 85.10%. As a Healthcare name, SGMT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to SGMT-specific events.

SGMT 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. SGMT positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move SGMT alongside the broader basket even when SGMT-specific fundamentals are unchanged. Always rebuild the position from current SGMT chain quotes before placing a trade.

Frequently asked questions

What is a straddle on SGMT?
A straddle on SGMT is the straddle strategy applied to SGMT (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 SGMT stock trading near $6.92, the strikes shown on this page are snapped to the nearest listed SGMT chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are SGMT 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 SGMT straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 85.10%), 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 SGMT straddle?
The breakeven for the SGMT 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 SGMT market-implied 1-standard-deviation expected move is approximately 24.40%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a straddle on SGMT?
Straddles on SGMT are pure-volatility plays that profit from large moves in either direction; traders typically buy SGMT 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 SGMT implied volatility affect this straddle?
SGMT ATM IV is at 85.10% with IV rank near 8.25%, 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.

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