FSMD Butterfly Strategy
FSMD (Fidelity Small-Mid Multifactor ETF), in the Financial Services sector, (Asset Management industry), listed on AMEX.
This exchange-traded fund primarily invests in shares of American businesses with market capitalizations ranging from small to medium. It seeks out companies that are considered to be a good value, possess strong underlying business fundamentals, show a positive trend in their stock price, and exhibit more stable price movements compared to the overall market.
FSMD (Fidelity Small-Mid Multifactor ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $2.50B, a beta of 0.95 versus the broader market, a 52-week range of 41.858-53.48, average daily share volume of 162K, a public-listing history dating back to 2019. These structural characteristics shape how FSMD etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.95 places FSMD roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. FSMD pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on FSMD?
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.
FSMD snapshot
As of November 13, 2026, spot at $49.86. The butterfly on FSMD below is built from the November 13, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 7-day expiry.
Why this butterfly structure on FSMD specifically: IV rank is unavailable in the current snapshot, so regime-based timing for FSMD is inferred from ATM IV alone. The 7-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated FSMD expiries trade a higher absolute premium for lower per-day decay. Position sizing on FSMD should anchor to the underlying notional of $49.86 per share and to the trader's directional view on FSMD etf.
FSMD butterfly setup
The FSMD butterfly below is built from the November 13, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With FSMD at $49.86 on that close, the first option leg uses a $47.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FSMD chain at a 7-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 FSMD shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $47.00 | $3.10 |
| Sell 2 | Call | $50.00 | $0.98 |
| Buy 1 | Call | $52.00 | $0.30 |
FSMD butterfly risk and reward
- Net Premium / Debit
- -$144.00
- Max Profit (per contract)
- $144.45
- Max Loss (per contract)
- -$144.00
- Breakeven(s)
- $48.44, $51.56
- Risk / Reward Ratio
- 1.003
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.
FSMD butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on FSMD. 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% | -$144.00 |
| $11.03 | -77.9% | -$144.00 |
| $22.06 | -55.8% | -$144.00 |
| $33.08 | -33.7% | -$144.00 |
| $44.10 | -11.5% | -$144.00 |
| $55.13 | +10.6% | -$44.00 |
| $66.15 | +32.7% | -$44.00 |
| $77.17 | +54.8% | -$44.00 |
| $88.20 | +76.9% | -$44.00 |
| $99.22 | +99.0% | -$44.00 |
When traders use butterfly on FSMD
Butterflies on FSMD are pinning bets - traders use them when they expect FSMD 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.
FSMD thesis for this butterfly
A FSMD long call butterfly is a pinning play: it pays maximum at the middle strike if FSMD settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. As a Financial Services name, FSMD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FSMD-specific events.
FSMD 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. FSMD positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FSMD alongside the broader basket even when FSMD-specific fundamentals are unchanged. Always rebuild the position from current FSMD chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on FSMD?
- A butterfly on FSMD is the butterfly strategy applied to FSMD (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 FSMD etf at $49.86 on the November 13, 2026 close, the strikes shown on this page are snapped to the nearest listed FSMD chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are FSMD 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 FSMD butterfly priced from the November 13, 2026 end-of-day chain at a 30-day expiry (ATM IV the current ATM IV), the computed maximum profit is $144.45 per contract and the computed maximum loss is -$144.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a FSMD butterfly?
- The breakeven for the FSMD butterfly priced on this page is roughly $48.44 and $51.56 at expiration, derived from the November 13, 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.
- When should you consider a butterfly on FSMD?
- Butterflies on FSMD are pinning bets - traders use them when they expect FSMD 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 FSMD implied volatility affect this butterfly?
- Current FSMD ATM IV is the current ATM IV; IV rank context is unavailable in the current snapshot.