AMZD Butterfly Strategy
AMZD (Direxion Daily AMZN Bear 1X ETF), in the Financial Services sector, (Asset Management - Leveraged industry), listed on NASDAQ.
The Direxion Daily AMZN Bull 2X ETF and Direxion Daily AMZN Bear 1X ETF seek daily investment results, before fees and expenses, of 200% and 100% of the inverse (or opposite), respectively, of the performance of the common shares of Amazon.com, Inc. (NASDAQ: AMZN).
AMZD (Direxion Daily AMZN Bear 1X ETF) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $4.0M, a beta of -1.31 versus the broader market, a 52-week range of 8.195-12.13, average daily share volume of 11.0M, a public-listing history dating back to 2022. These structural characteristics shape how AMZD etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of -1.31 indicates AMZD has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. AMZD pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on AMZD?
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.
Current AMZD snapshot
As of May 15, 2026, spot at $8.66, ATM IV 238.60%, IV rank 46.79%, expected move 7.22%. The butterfly on AMZD 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 63-day expiry.
Why this butterfly structure on AMZD specifically: AMZD IV at 238.60% is mid-range versus its 1-year history, so strategy selection should anchor more to the directional thesis than to the IV regime, with a market-implied 1-standard-deviation move of approximately 7.22% (roughly $0.63 on the underlying). The 63-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated AMZD expiries trade a higher absolute premium for lower per-day decay. Position sizing on AMZD should anchor to the underlying notional of $8.66 per share and to the trader's directional view on AMZD etf.
AMZD butterfly setup
The AMZD butterfly below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With AMZD near $8.66, the first option leg uses a $8.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AMZD chain at a 63-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 AMZD shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $8.00 | $0.85 |
| Sell 2 | Call | $9.00 | $0.46 |
| Buy 1 | Call | $9.00 | $0.46 |
AMZD butterfly risk and reward
- Net Premium / Debit
- -$39.00
- Max Profit (per contract)
- $61.00
- Max Loss (per contract)
- -$39.00
- Breakeven(s)
- $8.39
- Risk / Reward Ratio
- 1.564
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.
AMZD butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on AMZD. 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.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -99.9% | -$39.00 |
| $1.92 | -77.8% | -$39.00 |
| $3.84 | -55.7% | -$39.00 |
| $5.75 | -33.6% | -$39.00 |
| $7.66 | -11.5% | -$39.00 |
| $9.58 | +10.6% | +$61.00 |
| $11.49 | +32.7% | +$61.00 |
| $13.41 | +54.8% | +$61.00 |
| $15.32 | +76.9% | +$61.00 |
| $17.23 | +99.0% | +$61.00 |
When traders use butterfly on AMZD
Butterflies on AMZD are pinning bets - traders use them when they expect AMZD 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.
AMZD thesis for this butterfly
The market-implied 1-standard-deviation range for AMZD extends from approximately $8.03 on the downside to $9.29 on the upside. A AMZD long call butterfly is a pinning play: it pays maximum at the middle strike if AMZD settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current AMZD IV rank near 46.79% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on AMZD should anchor more to the directional view and the expected-move geometry. As a Financial Services name, AMZD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AMZD-specific events.
AMZD 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. AMZD positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move AMZD alongside the broader basket even when AMZD-specific fundamentals are unchanged. Always rebuild the position from current AMZD chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on AMZD?
- A butterfly on AMZD is the butterfly strategy applied to AMZD (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 AMZD etf trading near $8.66, the strikes shown on this page are snapped to the nearest listed AMZD chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are AMZD 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 AMZD butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 238.60%), the computed maximum profit is $61.00 per contract and the computed maximum loss is -$39.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a AMZD butterfly?
- The breakeven for the AMZD butterfly priced on this page is roughly $8.39 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 AMZD market-implied 1-standard-deviation expected move is approximately 7.22%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on AMZD?
- Butterflies on AMZD are pinning bets - traders use them when they expect AMZD 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 AMZD implied volatility affect this butterfly?
- AMZD ATM IV is at 238.60% with IV rank near 46.79%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.