TJX Strangle Strategy
TJX (The TJX Companies, Inc.), in the Consumer Cyclical sector, (Apparel - Retail industry), listed on NYSE.
The TJX Companies, Inc., together with its subsidiaries, operates as an off-price apparel and home fashions retailer. It operates through four segments: Marmaxx, HomeGoods, TJX Canada, and TJX International. The company sells family apparel, including footwear and accessories; home fashions, such as home basics, furniture, rugs, lighting products, giftware, soft home products, decorative accessories, tabletop, and cookware, as well as expanded pet, kids, and gourmet food departments; jewelry and accessories; and other merchandise. As of February 23, 2022, it operated 1,284 T.J. Maxx, 1,148 Marshalls, 850 HomeGoods, 59 Sierra, and 39 Homesense stores, as well as tjmaxx.com, marshalls.com, and sierra.com in the United States; 293 Winners, 147 HomeSense, and 106 Marshalls stores in Canada; 618 T.K. Maxx and 77 Homesense stores, as well as tkmaxx.com in Europe; and 68 T.K.
TJX (The TJX Companies, Inc.) trades in the Consumer Cyclical sector, specifically Apparel - Retail, with a market capitalization of approximately $162.73B, a trailing P/E of 30.11, a beta of 0.64 versus the broader market, a 52-week range of 119.84-165.82, average daily share volume of 5.0M, a public-listing history dating back to 1987, approximately 364K full-time employees. These structural characteristics shape how TJX stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.64 indicates TJX has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. TJX pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a strangle on TJX?
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 TJX snapshot
As of May 14, 2026, spot at $147.45, ATM IV 28.21%, IV rank 89.25%, expected move 8.09%. The strangle on TJX 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 28-day expiry.
Why this strangle structure on TJX specifically: TJX IV at 28.21% is rich versus its 1-year range, which makes a premium-buying TJX strangle relatively expensive in absolute-cost terms, with a market-implied 1-standard-deviation move of approximately 8.09% (roughly $11.93 on the underlying). The 28-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated TJX expiries trade a higher absolute premium for lower per-day decay. Position sizing on TJX should anchor to the underlying notional of $147.45 per share and to the trader's directional view on TJX stock.
TJX strangle setup
The TJX 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 TJX near $147.45, the first option leg uses a $155.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed TJX chain at a 28-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 TJX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $155.00 | $2.00 |
| Buy 1 | Put | $140.00 | $1.58 |
TJX strangle risk and reward
- Net Premium / Debit
- -$357.50
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- -$357.50
- Breakeven(s)
- $136.43, $158.58
- Risk / Reward Ratio
- Unbounded
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.
TJX strangle payoff curve
Modeled P&L at expiration across a range of underlying prices for the strangle on TJX. 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% | +$13,641.50 |
| $32.61 | -77.9% | +$10,381.41 |
| $65.21 | -55.8% | +$7,121.32 |
| $97.81 | -33.7% | +$3,861.23 |
| $130.41 | -11.6% | +$601.14 |
| $163.01 | +10.6% | +$443.95 |
| $195.62 | +32.7% | +$3,704.04 |
| $228.22 | +54.8% | +$6,964.13 |
| $260.82 | +76.9% | +$10,224.22 |
| $293.42 | +99.0% | +$13,484.31 |
When traders use strangle on TJX
Strangles on TJX 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 TJX chain.
TJX thesis for this strangle
The market-implied 1-standard-deviation range for TJX extends from approximately $135.52 on the downside to $159.38 on the upside. A TJX 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 TJX IV rank near 89.25% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on TJX at 28.21%. As a Consumer Cyclical name, TJX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to TJX-specific events.
TJX 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. TJX positions also carry Consumer Cyclical sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move TJX alongside the broader basket even when TJX-specific fundamentals are unchanged. Always rebuild the position from current TJX chain quotes before placing a trade.
Frequently asked questions
- What is a strangle on TJX?
- A strangle on TJX is the strangle strategy applied to TJX (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 TJX stock trading near $147.45, the strikes shown on this page are snapped to the nearest listed TJX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are TJX 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 TJX strangle priced from the end-of-day chain at a 30-day expiry (ATM IV 28.21%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$357.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a TJX strangle?
- The breakeven for the TJX strangle priced on this page is roughly $136.43 and $158.58 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 TJX market-implied 1-standard-deviation expected move is approximately 8.09%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a strangle on TJX?
- Strangles on TJX 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 TJX chain.
- How does current TJX implied volatility affect this strangle?
- TJX ATM IV is at 28.21% with IV rank near 89.25%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.