AFRU Butterfly Strategy
AFRU (T-REX 2X Long AFRM Daily Target ETF), in the Financial Services sector, (Asset Management industry), listed on CBOE.
AFRU primarily uses swap agreements to make bullish bets on the share price of Affirm Holdings, Inc. (NASDAQ: AFRM). Additionally, the fund may purchase FLEX call options on AFRM or invest directly in the stocks of AFRM. AFRM is a US technology company that provides financial services for shoppers and merchants. The fund seeks to maintain daily leveraged exposure equivalent to 200% of the daily percentage change in AFRM price through daily rebalancing. As a leveraged product, it is designed for short-term tactical use, not as a long-term investment vehicle. Returns may deviate from the expected 2x if held for longer than a single day due to factors such as volatility and compounding effects.
AFRU (T-REX 2X Long AFRM Daily Target ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $2.0M, a beta of 6.81 versus the broader market, a 52-week range of 4.045-19.24, average daily share volume of 50K, a public-listing history dating back to 2025. These structural characteristics shape how AFRU etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 6.81 indicates AFRU has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a butterfly on AFRU?
A long call butterfly buys one lower-strike call, sells two ATM calls, and buys one higher-strike call, paying a small net debit for a defined-risk position that maxes out if the underlying pins the middle strike at expiration.
AFRU snapshot
As of September 29, 2026, spot at $8.43, ATM IV 102.60%, IV rank 23.65%, expected move 29.41%. The butterfly on AFRU below is built from the September 29, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 80-day expiry.
Why this butterfly structure on AFRU specifically: AFRU IV at 102.60% is on the cheap side of its 1-year range, which favors premium-buying structures like a AFRU butterfly, with a market-implied 1-standard-deviation move of approximately 29.41% (roughly $2.48 on the underlying). The 80-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated AFRU expiries trade a higher absolute premium for lower per-day decay. Position sizing on AFRU should anchor to the underlying notional of $8.43 per share and to the trader's directional view on AFRU etf.
AFRU butterfly setup
The AFRU butterfly below is built from the September 29, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With AFRU at $8.43 on that close, the first option leg uses a $8.01 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AFRU chain at a 80-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 AFRU shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $8.01 | N/A |
| Sell 2 | Call | $8.43 | N/A |
| Buy 1 | Call | $8.85 | N/A |
AFRU butterfly 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
Max profit equals the wing width minus net debit times 100 (reached when the underlying pins the middle strike); max loss equals the net debit times 100. Two breakevens at lower-wing plus debit and upper-wing minus debit.
AFRU butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on AFRU. 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 butterfly on AFRU
Butterflies on AFRU are pinning bets - traders use them when they expect AFRU to settle near a specific level at expiration (often the prior close, a round number, or the max-pain strike) and want defined-risk exposure to that outcome.
AFRU thesis for this butterfly
The market-implied 1-standard-deviation range for AFRU extends from approximately $5.95 on the downside to $10.91 on the upside. A AFRU long call butterfly is a pinning play: it pays maximum at the middle strike if AFRU settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current AFRU IV rank near 23.65% 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 AFRU at 102.60%. As a Financial Services name, AFRU options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AFRU-specific events.
AFRU butterfly positions are structurally neutral / pin (limited-risk, limited-reward); 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. AFRU positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move AFRU alongside the broader basket even when AFRU-specific fundamentals are unchanged. Always rebuild the position from current AFRU chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on AFRU?
- A butterfly on AFRU is the butterfly strategy applied to AFRU (etf). The strategy is structurally neutral / pin (limited-risk, limited-reward): A long call butterfly buys one lower-strike call, sells two ATM calls, and buys one higher-strike call, paying a small net debit for a defined-risk position that maxes out if the underlying pins the middle strike at expiration. With AFRU etf at $8.43 on the September 29, 2026 close, the strikes shown on this page are snapped to the nearest listed AFRU chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are AFRU butterfly max profit and max loss calculated?
- Max profit equals the wing width minus net debit times 100 (reached when the underlying pins the middle strike); max loss equals the net debit times 100. Two breakevens at lower-wing plus debit and upper-wing minus debit. For the AFRU butterfly priced from the September 29, 2026 end-of-day chain at a 30-day expiry (ATM IV 102.60%), 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 AFRU butterfly?
- The breakeven for the AFRU butterfly priced on this page is no defined breakeven on the modeled curve at expiration, derived from the September 29, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The AFRU market-implied 1-standard-deviation expected move in the same options snapshot is approximately 29.41%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on AFRU?
- Butterflies on AFRU are pinning bets - traders use them when they expect AFRU to settle near a specific level at expiration (often the prior close, a round number, or the max-pain strike) and want defined-risk exposure to that outcome.
- How does current AFRU implied volatility affect this butterfly?
- AFRU ATM IV is at 102.60% with IV rank near 23.65%, 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.