How are SMTC 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 SMTC straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 94.40%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$2,650.17 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a SMTC straddle?

The breakeven for the SMTC straddle priced on this page is roughly $138.30 and $191.70 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 SMTC market-implied 1-standard-deviation expected move is approximately 27.06%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current SMTC implied volatility affect this straddle?

SMTC ATM IV is at 94.40% with IV rank near 47.95%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.

SMTC Straddle Strategy

SMTC (Semtech Corporation), in the Technology sector, (Semiconductors industry), listed on NASDAQ.

Semtech Corporation is a technology firm specializing in the creation, production, and global distribution of advanced analog and mixed-signal semiconductor components, complemented by sophisticated algorithms. The company's extensive product portfolio begins with signal integrity solutions. These encompass crucial optical data communication and video transport products utilized in various infrastructure and industrial environments. It also provides integrated circuits specifically engineered for data centers, corporate networks, passive optical networks, wireless base station optical transceivers, and high-speed interface applications. Furthermore, Semtech develops video technologies for broadcast purposes and professional audio-visual (AV) needs, including innovative video-over-IP technology. Another significant offering involves protection products, which integrate filter and termination devices with transient voltage suppressors.

SMTC (Semtech Corporation) trades in the Technology sector, specifically Semiconductors, with a market capitalization of approximately $13.95B, a beta of 2.32 versus the broader market, a 52-week range of 42.38-177.35, average daily share volume of 3.5M, a public-listing history dating back to 1980, approximately 2K full-time employees. These structural characteristics shape how SMTC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 2.32 indicates SMTC 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 SMTC?

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 SMTC snapshot

As of June 30, 2026, spot at $162.74, ATM IV 94.40%, IV rank 47.95%, expected move 27.06%. The straddle on SMTC 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 straddle structure on SMTC specifically: SMTC IV at 94.40% is mid-range versus its 1-year history, so strategy selection should anchor more to the directional thesis than to the IV regime, with a market-implied 1-standard-deviation move of approximately 27.06% (roughly $44.04 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 SMTC expiries trade a higher absolute premium for lower per-day decay. Position sizing on SMTC should anchor to the underlying notional of $162.74 per share and to the trader's directional view on SMTC stock.

SMTC straddle setup

The SMTC 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 SMTC near $162.74, the first option leg uses a $165.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed SMTC 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 SMTC shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$165.00	$12.70
Buy 1	Put	$165.00	$14.00

SMTC straddle risk and reward

Net Premium / Debit: -$2,670.00
Max Profit (per contract): Unbounded
Max Loss (per contract): -$2,650.17
Breakeven(s): $138.30, $191.70
Risk / Reward Ratio: Unbounded

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.

SMTC straddle payoff curve

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

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	+$13,829.00
$35.99	-77.9%	+$10,230.84
$71.97	-55.8%	+$6,632.68
$107.95	-33.7%	+$3,034.52
$143.94	-11.6%	-$563.64
$179.92	+10.6%	-$1,178.20
$215.90	+32.7%	+$2,419.96
$251.88	+54.8%	+$6,018.13
$287.86	+76.9%	+$9,616.29
$323.84	+99.0%	+$13,214.45

When traders use straddle on SMTC

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

SMTC thesis for this straddle

The market-implied 1-standard-deviation range for SMTC extends from approximately $118.70 on the downside to $206.78 on the upside. A SMTC 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 SMTC IV rank near 47.95% is mid-range against its 1-year distribution, so the IV signal is neutral; the straddle thesis on SMTC should anchor more to the directional view and the expected-move geometry. As a Technology name, SMTC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to SMTC-specific events.

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

Frequently asked questions

What is a straddle on SMTC?: A straddle on SMTC is the straddle strategy applied to SMTC (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 SMTC stock trading near $162.74, the strikes shown on this page are snapped to the nearest listed SMTC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are SMTC 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 SMTC straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 94.40%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$2,650.17 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a SMTC straddle?: The breakeven for the SMTC straddle priced on this page is roughly $138.30 and $191.70 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 SMTC market-implied 1-standard-deviation expected move is approximately 27.06%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a straddle on SMTC?: Straddles on SMTC are pure-volatility plays that profit from large moves in either direction; traders typically buy SMTC 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 SMTC implied volatility affect this straddle?: SMTC ATM IV is at 94.40% with IV rank near 47.95%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.