TRVI Straddle Strategy
TRVI (Trevi Therapeutics, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Trevi Therapeutics, Inc., a clinical-stage biopharmaceutical company, focuses on the development and commercialization of Haduvio to treat serious neurologically mediated conditions. The company is developing Haduvio, an oral extended-release formulation of nalbuphine, which is in phase IIb/III clinical trial for the treatment of chronic pruritus, chronic cough in patients with idiopathic pulmonary fibrosis. It has a license agreement with Endo Pharmaceuticals Inc. to develop and commercialize products incorporating nalbuphine hydrochloride in any formulation. The company was incorporated in 2011 and is headquartered in New Haven, Connecticut.
TRVI (Trevi Therapeutics, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $2.17B, a beta of 1.08 versus the broader market, a 52-week range of 5.38-16.12, average daily share volume of 1.5M, a public-listing history dating back to 2019, approximately 31 full-time employees. These structural characteristics shape how TRVI stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.08 places TRVI roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a straddle on TRVI?
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 TRVI snapshot
As of May 15, 2026, spot at $14.21, ATM IV 63.30%, IV rank 7.27%, expected move 18.15%. The straddle on TRVI 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 63-day expiry.
Why this straddle structure on TRVI specifically: TRVI IV at 63.30% is on the cheap side of its 1-year range, which favors premium-buying structures like a TRVI straddle, with a market-implied 1-standard-deviation move of approximately 18.15% (roughly $2.58 on the underlying). The 63-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated TRVI expiries trade a higher absolute premium for lower per-day decay. Position sizing on TRVI should anchor to the underlying notional of $14.21 per share and to the trader's directional view on TRVI stock.
TRVI straddle setup
The TRVI 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 TRVI near $14.21, the first option leg uses a $14.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed TRVI chain at a 63-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 TRVI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $14.00 | $1.43 |
| Buy 1 | Put | $14.00 | $1.08 |
TRVI straddle risk and reward
- Net Premium / Debit
- -$250.00
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- -$249.91
- Breakeven(s)
- $11.50, $16.50
- 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.
TRVI straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on TRVI. 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 | -99.9% | +$1,149.00 |
| $3.15 | -77.8% | +$834.92 |
| $6.29 | -55.7% | +$520.84 |
| $9.43 | -33.6% | +$206.76 |
| $12.57 | -11.5% | -$107.32 |
| $15.71 | +10.6% | -$78.60 |
| $18.85 | +32.7% | +$235.48 |
| $22.00 | +54.8% | +$549.56 |
| $25.14 | +76.9% | +$863.64 |
| $28.28 | +99.0% | +$1,177.72 |
When traders use straddle on TRVI
Straddles on TRVI are pure-volatility plays that profit from large moves in either direction; traders typically buy TRVI straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
TRVI thesis for this straddle
The market-implied 1-standard-deviation range for TRVI extends from approximately $11.63 on the downside to $16.79 on the upside. A TRVI 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 TRVI IV rank near 7.27% 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 TRVI at 63.30%. As a Healthcare name, TRVI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to TRVI-specific events.
TRVI 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. TRVI positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move TRVI alongside the broader basket even when TRVI-specific fundamentals are unchanged. Always rebuild the position from current TRVI chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on TRVI?
- A straddle on TRVI is the straddle strategy applied to TRVI (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 TRVI stock trading near $14.21, the strikes shown on this page are snapped to the nearest listed TRVI chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are TRVI 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 TRVI straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 63.30%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$249.91 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a TRVI straddle?
- The breakeven for the TRVI straddle priced on this page is roughly $11.50 and $16.50 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 TRVI market-implied 1-standard-deviation expected move is approximately 18.15%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on TRVI?
- Straddles on TRVI are pure-volatility plays that profit from large moves in either direction; traders typically buy TRVI 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 TRVI implied volatility affect this straddle?
- TRVI ATM IV is at 63.30% with IV rank near 7.27%, 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.