PXH Butterfly Strategy
PXH (Invesco RAFI Emerging Markets ETF), in the Financial Services sector, (Asset Management industry), listed on AMEX.
The Invesco RAFI Emerging Markets ETF (Fund) is based on the RAFI Fundamental Select Emerging Markets 350 Index (Index). The Fund will generally invest at least 90% of its total assets in the securities that comprise the Index as well as American Depository Receipts (ADRs) and global depositary receipts (GDRs) that represent securities in the Index. The Index is designed to track the performance of the largest emerging market equities, selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends. The equities with the highest fundamental strength are weighted according to their fundamental scores. The Index is computed using the net return, which withholds applicable taxes for non-resident investors. The Fund and the Index are reconstituted annually.Effective close of business March 21, 2025, FTSE RAFI Emerging Index ("Current Underlying Index") will change to the RAFI Fundamental Select Emerging Markets 350 Index ("New Underlying Index").
PXH (Invesco RAFI Emerging Markets ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $1.95B, a beta of 0.78 versus the broader market, a 52-week range of 22.08-29.58, average daily share volume of 309K, a public-listing history dating back to 2007. These structural characteristics shape how PXH etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.78 places PXH roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. PXH pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on PXH?
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 PXH snapshot
As of May 15, 2026, spot at $28.45, ATM IV 31.70%, IV rank 2.43%, expected move 9.09%. The butterfly on PXH 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 34-day expiry.
Why this butterfly structure on PXH specifically: PXH IV at 31.70% is on the cheap side of its 1-year range, which favors premium-buying structures like a PXH butterfly, with a market-implied 1-standard-deviation move of approximately 9.09% (roughly $2.59 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated PXH expiries trade a higher absolute premium for lower per-day decay. Position sizing on PXH should anchor to the underlying notional of $28.45 per share and to the trader's directional view on PXH etf.
PXH butterfly setup
The PXH 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 PXH near $28.45, the first option leg uses a $27.03 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PXH chain at a 34-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 PXH shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $27.03 | N/A |
| Sell 2 | Call | $28.45 | N/A |
| Buy 1 | Call | $29.87 | N/A |
PXH 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.
PXH butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on PXH. 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 PXH
Butterflies on PXH are pinning bets - traders use them when they expect PXH 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.
PXH thesis for this butterfly
The market-implied 1-standard-deviation range for PXH extends from approximately $25.86 on the downside to $31.04 on the upside. A PXH long call butterfly is a pinning play: it pays maximum at the middle strike if PXH settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current PXH IV rank near 2.43% 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 PXH at 31.70%. As a Financial Services name, PXH options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PXH-specific events.
PXH 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. PXH positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PXH alongside the broader basket even when PXH-specific fundamentals are unchanged. Always rebuild the position from current PXH chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on PXH?
- A butterfly on PXH is the butterfly strategy applied to PXH (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 PXH etf trading near $28.45, the strikes shown on this page are snapped to the nearest listed PXH chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PXH 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 PXH butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 31.70%), 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 PXH butterfly?
- The breakeven for the PXH butterfly priced on this page is no defined breakeven on the modeled curve 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 PXH market-implied 1-standard-deviation expected move is approximately 9.09%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on PXH?
- Butterflies on PXH are pinning bets - traders use them when they expect PXH 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 PXH implied volatility affect this butterfly?
- PXH ATM IV is at 31.70% with IV rank near 2.43%, 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.