TSMG Butterfly Strategy
TSMG (Leverage Shares 2x Long TSM Daily ETF), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.
The Leverage Shares 2x Long TSM Daily ETF (TSMG) is a 2x Daily Leveraged (Bull) ETF designed for active traders seeking to magnify short-term results. The TSMG ETF aims to achieve two times (200%) the daily performance of TSM stock, minus fees and expenses.
TSMG (Leverage Shares 2x Long TSM Daily ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $11.6M, a beta of 4.25 versus the broader market, a 52-week range of 11.45-41.39, average daily share volume of 112K, a public-listing history dating back to 2024. These structural characteristics shape how TSMG etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 4.25 indicates TSMG has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. TSMG pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on TSMG?
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 TSMG snapshot
As of May 15, 2026, spot at $38.39, ATM IV 86.20%, IV rank 28.51%, expected move 24.71%. The butterfly on TSMG 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 TSMG specifically: TSMG IV at 86.20% is on the cheap side of its 1-year range, which favors premium-buying structures like a TSMG butterfly, with a market-implied 1-standard-deviation move of approximately 24.71% (roughly $9.49 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 TSMG expiries trade a higher absolute premium for lower per-day decay. Position sizing on TSMG should anchor to the underlying notional of $38.39 per share and to the trader's directional view on TSMG etf.
TSMG butterfly setup
The TSMG 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 TSMG near $38.39, the first option leg uses a $36.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed TSMG 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 TSMG shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $36.00 | $5.25 |
| Sell 2 | Call | $37.00 | $4.85 |
| Buy 1 | Call | $40.00 | $3.15 |
TSMG butterfly risk and reward
- Net Premium / Debit
- +$130.00
- Max Profit (per contract)
- $225.52
- Max Loss (per contract)
- -$70.00
- Breakeven(s)
- $39.30
- Risk / Reward Ratio
- 3.222
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.
TSMG butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on TSMG. 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% | +$130.00 |
| $8.50 | -77.9% | +$130.00 |
| $16.98 | -55.8% | +$130.00 |
| $25.47 | -33.7% | +$130.00 |
| $33.96 | -11.5% | +$130.00 |
| $42.45 | +10.6% | -$70.00 |
| $50.93 | +32.7% | -$70.00 |
| $59.42 | +54.8% | -$70.00 |
| $67.91 | +76.9% | -$70.00 |
| $76.39 | +99.0% | -$70.00 |
When traders use butterfly on TSMG
Butterflies on TSMG are pinning bets - traders use them when they expect TSMG 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.
TSMG thesis for this butterfly
The market-implied 1-standard-deviation range for TSMG extends from approximately $28.90 on the downside to $47.88 on the upside. A TSMG long call butterfly is a pinning play: it pays maximum at the middle strike if TSMG settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current TSMG IV rank near 28.51% 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 TSMG at 86.20%. As a Financial Services name, TSMG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to TSMG-specific events.
TSMG 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. TSMG positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move TSMG alongside the broader basket even when TSMG-specific fundamentals are unchanged. Always rebuild the position from current TSMG chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on TSMG?
- A butterfly on TSMG is the butterfly strategy applied to TSMG (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 TSMG etf trading near $38.39, the strikes shown on this page are snapped to the nearest listed TSMG chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are TSMG 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 TSMG butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 86.20%), the computed maximum profit is $225.52 per contract and the computed maximum loss is -$70.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a TSMG butterfly?
- The breakeven for the TSMG butterfly priced on this page is roughly $39.30 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 TSMG market-implied 1-standard-deviation expected move is approximately 24.71%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on TSMG?
- Butterflies on TSMG are pinning bets - traders use them when they expect TSMG 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 TSMG implied volatility affect this butterfly?
- TSMG ATM IV is at 86.20% with IV rank near 28.51%, 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.