FNX Butterfly Strategy
FNX (First Trust Mid Cap Core AlphaDEX Fund), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.
The First Trust Mid Cap Core AlphaDEX Fund is an exchange-traded fund. The investment objective of the Fund is to seek investment results that correspond generally to the price and yield, before fees and expenses, of an equity index called the Nasdaq AlphaDEX Mid Cap Core Index.
FNX (First Trust Mid Cap Core AlphaDEX Fund) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $1.32B, a beta of 1.17 versus the broader market, a 52-week range of 108.55-140.82, average daily share volume of 31K, a public-listing history dating back to 2007. These structural characteristics shape how FNX etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.17 places FNX roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. FNX pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on FNX?
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 FNX snapshot
As of May 15, 2026, spot at $135.96, ATM IV 19.60%, IV rank 38.03%, expected move 5.62%. The butterfly on FNX 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 FNX specifically: FNX IV at 19.60% 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 5.62% (roughly $7.64 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 FNX expiries trade a higher absolute premium for lower per-day decay. Position sizing on FNX should anchor to the underlying notional of $135.96 per share and to the trader's directional view on FNX etf.
FNX butterfly setup
The FNX 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 FNX near $135.96, the first option leg uses a $129.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FNX 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 FNX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $129.00 | $9.30 |
| Sell 2 | Call | $136.00 | $4.45 |
| Buy 1 | Call | $143.00 | $1.58 |
FNX butterfly risk and reward
- Net Premium / Debit
- -$197.50
- Max Profit (per contract)
- $437.68
- Max Loss (per contract)
- -$197.50
- Breakeven(s)
- $130.98, $141.03
- Risk / Reward Ratio
- 2.216
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.
FNX butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on FNX. 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 | -100.0% | -$197.50 |
| $30.07 | -77.9% | -$197.50 |
| $60.13 | -55.8% | -$197.50 |
| $90.19 | -33.7% | -$197.50 |
| $120.25 | -11.6% | -$197.50 |
| $150.31 | +10.6% | -$197.50 |
| $180.37 | +32.7% | -$197.50 |
| $210.43 | +54.8% | -$197.50 |
| $240.49 | +76.9% | -$197.50 |
| $270.55 | +99.0% | -$197.50 |
When traders use butterfly on FNX
Butterflies on FNX are pinning bets - traders use them when they expect FNX 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.
FNX thesis for this butterfly
The market-implied 1-standard-deviation range for FNX extends from approximately $128.32 on the downside to $143.60 on the upside. A FNX long call butterfly is a pinning play: it pays maximum at the middle strike if FNX settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current FNX IV rank near 38.03% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on FNX should anchor more to the directional view and the expected-move geometry. As a Financial Services name, FNX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FNX-specific events.
FNX 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. FNX positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FNX alongside the broader basket even when FNX-specific fundamentals are unchanged. Always rebuild the position from current FNX chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on FNX?
- A butterfly on FNX is the butterfly strategy applied to FNX (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 FNX etf trading near $135.96, the strikes shown on this page are snapped to the nearest listed FNX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are FNX 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 FNX butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 19.60%), the computed maximum profit is $437.68 per contract and the computed maximum loss is -$197.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a FNX butterfly?
- The breakeven for the FNX butterfly priced on this page is roughly $130.98 and $141.03 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 FNX market-implied 1-standard-deviation expected move is approximately 5.62%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on FNX?
- Butterflies on FNX are pinning bets - traders use them when they expect FNX 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 FNX implied volatility affect this butterfly?
- FNX ATM IV is at 19.60% with IV rank near 38.03%, 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.