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Long Straddle (Long Vol)
volatility Capped lossAdvanced: profit from a big move either way; risk limited to the premium.
When to use it
Buy an ATM call and put. Profits from a large move in either direction or an IV spike. Best before catalysts when IV is low.
Max profit
Large — grows with the size of the move.
Max loss
The total premium paid.
Payoff at expiry
illustrative shape — not to scale
■ profit zone
■ loss zone
X axis = stock price at expiry →
How it's built
Strikes shown low→high. Sell = collect premium · Buy = pay premium for protection or upside.
Hermes-evaluated setups
High-conviction per-ticker applications — setups with a confidence-adjusted win rate ≥ 80% over ≥20 backtested trades (95% lower bound — honest for the sample size, never a raw 100%). Avg P/L is the mean profit/loss per one-contract position.
| Ticker | Win Rate | Avg P/L / contract | Sharpe | Trades | DTE |
|---|---|---|---|---|---|
| GEV | 89% | +$2,557.00 | 5.4 | 31 | 17 |
| NBIS | 85% | +$726.00 | 4.0 | 34 | 11 |
Backtested results are not a guarantee of future performance.