IEDI Butterfly Strategy
IEDI (iShares U.S. Consumer Focused ETF), in the Financial Services sector, (Asset Management industry), listed on CBOE.
The iShares U.S. Consumer Focused ETF aims to provide investment exposure to U.S. companies operating in the discretionary consumer spending sector, identified through a unique proprietary classification system. The fund further prioritizes increasing its allocation to American businesses that generate a larger percentage of their revenue from consumer expenditures and have more of their consumer goods and services produced domestically, thereby amplifying these specific characteristics beyond the general scope of its proprietary classification.
IEDI (iShares U.S. Consumer Focused ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $27.4M, a beta of 0.93 versus the broader market, a 52-week range of 52.335-58.473, average daily share volume of 3K, a public-listing history dating back to 2018. These structural characteristics shape how IEDI etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.93 places IEDI roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. IEDI pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on IEDI?
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 IEDI snapshot
As of June 30, 2026, spot at $54.71, ATM IV 29.20%, IV rank 22.19%, expected move 8.37%. The butterfly on IEDI 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 17-day expiry.
Why this butterfly structure on IEDI specifically: IEDI IV at 29.20% is on the cheap side of its 1-year range, which favors premium-buying structures like a IEDI butterfly, with a market-implied 1-standard-deviation move of approximately 8.37% (roughly $4.58 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated IEDI expiries trade a higher absolute premium for lower per-day decay. Position sizing on IEDI should anchor to the underlying notional of $54.71 per share and to the trader's directional view on IEDI etf.
IEDI butterfly setup
The IEDI 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 IEDI near $54.71, the first option leg uses a $52.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed IEDI chain at a 17-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 IEDI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $52.00 | $2.75 |
| Sell 2 | Call | $55.00 | $1.28 |
| Buy 1 | Call | $57.00 | $0.57 |
IEDI butterfly risk and reward
- Net Premium / Debit
- -$76.00
- Max Profit (per contract)
- $222.99
- Max Loss (per contract)
- -$76.00
- Breakeven(s)
- $52.76
- Risk / Reward Ratio
- 2.934
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.
IEDI butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on IEDI. 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% | -$76.00 |
| $12.11 | -77.9% | -$76.00 |
| $24.20 | -55.8% | -$76.00 |
| $36.30 | -33.7% | -$76.00 |
| $48.39 | -11.5% | -$76.00 |
| $60.49 | +10.6% | +$24.00 |
| $72.58 | +32.7% | +$24.00 |
| $84.68 | +54.8% | +$24.00 |
| $96.77 | +76.9% | +$24.00 |
| $108.87 | +99.0% | +$24.00 |
When traders use butterfly on IEDI
Butterflies on IEDI are pinning bets - traders use them when they expect IEDI 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.
IEDI thesis for this butterfly
The market-implied 1-standard-deviation range for IEDI extends from approximately $50.13 on the downside to $59.29 on the upside. A IEDI long call butterfly is a pinning play: it pays maximum at the middle strike if IEDI settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current IEDI IV rank near 22.19% 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 IEDI at 29.20%. As a Financial Services name, IEDI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to IEDI-specific events.
IEDI 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. IEDI positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move IEDI alongside the broader basket even when IEDI-specific fundamentals are unchanged. Always rebuild the position from current IEDI chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on IEDI?
- A butterfly on IEDI is the butterfly strategy applied to IEDI (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 IEDI etf trading near $54.71, the strikes shown on this page are snapped to the nearest listed IEDI chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are IEDI 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 IEDI butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 29.20%), the computed maximum profit is $222.99 per contract and the computed maximum loss is -$76.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a IEDI butterfly?
- The breakeven for the IEDI butterfly priced on this page is roughly $52.76 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 IEDI market-implied 1-standard-deviation expected move is approximately 8.37%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on IEDI?
- Butterflies on IEDI are pinning bets - traders use them when they expect IEDI 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 IEDI implied volatility affect this butterfly?
- IEDI ATM IV is at 29.20% with IV rank near 22.19%, 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.