Tool
Implied move from a straddle
A straddle's price tells you how big a move the options market is pricing. Type the two numbers and see the range.
A straddle is a call and a put with the same strike and expiration, bought together. It makes money when the stock moves far enough in either direction. Its price, per share, is what traders pay for that move. Divide it by the stock price and you get the implied move: the size of move the price has built in, as a percent. It has no direction.
Step 1 · Drag the stock price
The example: a $9.00 straddle on a $100.00 stock
The straddle costs $9.00 for a $100.00 stock, so the market is pricing a move of about 9.0%. The stock has to end below $91.00 or above $109.00 for the straddle to make money.
Stock ends at $100.00: loss $9.00 a share, $900 a contract.
As of your numbersSource computed on this page. Sample examples, not quotes.
Step 2 · Type your own numbers
The chart above follows them.
What it shows
The straddle only makes money if the stock ends outside the range its own price draws.
The edges of the range are the straddle's two breakevens. That is why the price is read as a move: it is the move the stock has to beat.
How it is computed
Method. The implied move is the straddle's price divided by the stock price. The two breakevens are the stock price plus and minus the straddle's price. The page takes the strike to be the stock price. On its last day the straddle gains how far the stock ended from that strike, less the straddle's price, per share. One contract covers 100 shares.
Limits. The implied move is a shorthand. A straddle's price also holds the cost of time and other things, so the figure is a rough size, not a forecast. The same straddle can be priced for any expiration, and the move it shows covers all the time until then. The examples are not quotes. Commissions, taxes and early assignment are left out. This page does not use your accounts or positions. This is a hypothetical illustration of option math.