Trading a LUV straddle lets you take a pure volatility position on Southwest Airlines Co without committing to a direction. Southwest Airlines Co's straddle involves buying (or selling) a call and a put at the same strike and expiration, profiting when the stock moves more (or less) than the combined premium implies. Use our scanner to evaluate LUV straddle pricing in real time and find the moments when expected moves are mispriced.
A long straddle on LUV profits from large moves in either direction and is a classic play into binary events like earnings, product announcements, or macro releases. A short straddle profits when Southwest Airlines Co stays range-bound and implied volatility contracts. The breakeven points are simple: strike plus total premium on the upside, strike minus total premium on the downside. Comparing the LUV straddle price to historical realized moves helps you judge whether the market is overpaying or underpaying for volatility.
Southwest Airlines Co. operates as a passenger airline company that provide scheduled air transportation services in the United States and near-international markets. As of December 31, 2021, the company operated a total fleet of 728 Boeing 737 aircrafts; and served 121 destinations in 42 states, the District of Columbia, and the Commonwealth of Puerto Rico, as well as 10 near-international countries, including Mexico, Jamaica, the Bahamas, Aruba, the Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos. It also provides inflight entertainment and connectivity services on Wi-Fi enabled aircrafts; and Rapid Rewards loyalty program that enables program members to earn points for dollars spent on Southwest base fares.
In addition, the company offers a suite of digital platforms to support customers' travel needs, including websites and apps; and SWABIZ, an online booking tool. Further, it provides ancillary services, such as Southwest's EarlyBird Check-In, upgraded boarding, and transportation of pets and unaccompanied minors. The company was incorporated in 1967 and is headquartered in Dallas, Texas.
Earnings, product cycles, macro prints — any time volatility itself is the trade, the LUV straddle is the cleanest expression of that view. Our scanner prices every LUV straddle against historical realized moves, flags expirations where the market is overpaying or underpaying for vol, and ranks setups by breakeven width and IV rank. Whether you're long a LUV straddle into a catalyst or short a LUV straddle to harvest decay, the options straddle setups that matter are all in one place.
