UFO Butterfly Strategy
UFO (Procure Space ETF), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.
The Procure Space ETF seeks investment results that correspond generally to the performance, before the Fund’s fees and expenses, of an equity index called the 'S-Network Space Index' which is designed to measure the performance of companies engaged in space-related industries.
UFO (Procure Space ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $172.5M, a beta of 1.56 versus the broader market, a 52-week range of 23.695-57.115, average daily share volume of 720K, a public-listing history dating back to 2019. These structural characteristics shape how UFO etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.56 indicates UFO has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. UFO pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on UFO?
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 UFO snapshot
As of May 15, 2026, spot at $56.56, ATM IV 48.00%, IV rank 41.84%, expected move 13.76%. The butterfly on UFO 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 UFO specifically: UFO IV at 48.00% 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 13.76% (roughly $7.78 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 UFO expiries trade a higher absolute premium for lower per-day decay. Position sizing on UFO should anchor to the underlying notional of $56.56 per share and to the trader's directional view on UFO etf.
UFO butterfly setup
The UFO 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 UFO near $56.56, the first option leg uses a $55.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed UFO 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 UFO shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $55.00 | $4.15 |
| Sell 2 | Call | $55.00 | $4.15 |
| Buy 1 | Call | $60.00 | $2.03 |
UFO butterfly risk and reward
- Net Premium / Debit
- +$212.50
- Max Profit (per contract)
- $212.50
- Max Loss (per contract)
- -$287.50
- Breakeven(s)
- $57.13
- Risk / Reward Ratio
- 0.739
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.
UFO butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on UFO. 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% | +$212.50 |
| $12.51 | -77.9% | +$212.50 |
| $25.02 | -55.8% | +$212.50 |
| $37.52 | -33.7% | +$212.50 |
| $50.03 | -11.5% | +$212.50 |
| $62.53 | +10.6% | -$287.50 |
| $75.04 | +32.7% | -$287.50 |
| $87.54 | +54.8% | -$287.50 |
| $100.05 | +76.9% | -$287.50 |
| $112.55 | +99.0% | -$287.50 |
When traders use butterfly on UFO
Butterflies on UFO are pinning bets - traders use them when they expect UFO 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.
UFO thesis for this butterfly
The market-implied 1-standard-deviation range for UFO extends from approximately $48.78 on the downside to $64.34 on the upside. A UFO long call butterfly is a pinning play: it pays maximum at the middle strike if UFO settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current UFO IV rank near 41.84% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on UFO should anchor more to the directional view and the expected-move geometry. As a Financial Services name, UFO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to UFO-specific events.
UFO 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. UFO positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move UFO alongside the broader basket even when UFO-specific fundamentals are unchanged. Always rebuild the position from current UFO chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on UFO?
- A butterfly on UFO is the butterfly strategy applied to UFO (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 UFO etf trading near $56.56, the strikes shown on this page are snapped to the nearest listed UFO chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are UFO 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 UFO butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 48.00%), the computed maximum profit is $212.50 per contract and the computed maximum loss is -$287.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a UFO butterfly?
- The breakeven for the UFO butterfly priced on this page is roughly $57.13 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 UFO market-implied 1-standard-deviation expected move is approximately 13.76%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on UFO?
- Butterflies on UFO are pinning bets - traders use them when they expect UFO 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 UFO implied volatility affect this butterfly?
- UFO ATM IV is at 48.00% with IV rank near 41.84%, 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.