ZDGE Straddle Strategy
ZDGE (Zedge, Inc.), in the Communication Services sector, (Internet Content & Information industry), listed on AMEX.
Zedge, Inc. operates a digital publishing and content platform worldwide. Its platform enables consumers to personalize their mobile devices with ringtones, home screen app icons, wallpapers, widgets, and notification sounds. The company was incorporated in 2008 and is based in New York, New York.
ZDGE (Zedge, Inc.) trades in the Communication Services sector, specifically Internet Content & Information, with a market capitalization of approximately $36.5M, a beta of 1.31 versus the broader market, a 52-week range of 2.12-4.89, average daily share volume of 68K, a public-listing history dating back to 2016, approximately 106 full-time employees. These structural characteristics shape how ZDGE stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.31 indicates ZDGE has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. ZDGE pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a straddle on ZDGE?
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 ZDGE snapshot
As of May 15, 2026, spot at $2.87, ATM IV 98.20%, IV rank 18.88%, expected move 28.15%. The straddle on ZDGE 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 ZDGE specifically: ZDGE IV at 98.20% is on the cheap side of its 1-year range, which favors premium-buying structures like a ZDGE straddle, with a market-implied 1-standard-deviation move of approximately 28.15% (roughly $0.81 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 ZDGE expiries trade a higher absolute premium for lower per-day decay. Position sizing on ZDGE should anchor to the underlying notional of $2.87 per share and to the trader's directional view on ZDGE stock.
ZDGE straddle setup
The ZDGE 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 ZDGE near $2.87, the first option leg uses a $2.87 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ZDGE 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 ZDGE shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $2.87 | N/A |
| Buy 1 | Put | $2.87 | N/A |
ZDGE 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.
ZDGE straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on ZDGE. 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 ZDGE
Straddles on ZDGE are pure-volatility plays that profit from large moves in either direction; traders typically buy ZDGE straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
ZDGE thesis for this straddle
The market-implied 1-standard-deviation range for ZDGE extends from approximately $2.06 on the downside to $3.68 on the upside. A ZDGE 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 ZDGE IV rank near 18.88% 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 ZDGE at 98.20%. As a Communication Services name, ZDGE options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ZDGE-specific events.
ZDGE 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. ZDGE positions also carry Communication Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ZDGE alongside the broader basket even when ZDGE-specific fundamentals are unchanged. Always rebuild the position from current ZDGE chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on ZDGE?
- A straddle on ZDGE is the straddle strategy applied to ZDGE (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 ZDGE stock trading near $2.87, the strikes shown on this page are snapped to the nearest listed ZDGE chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ZDGE 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 ZDGE straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 98.20%), 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 ZDGE straddle?
- The breakeven for the ZDGE 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 ZDGE market-implied 1-standard-deviation expected move is approximately 28.15%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on ZDGE?
- Straddles on ZDGE are pure-volatility plays that profit from large moves in either direction; traders typically buy ZDGE 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 ZDGE implied volatility affect this straddle?
- ZDGE ATM IV is at 98.20% with IV rank near 18.88%, 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.