ULTY Butterfly Strategy
ULTY (YieldMax Ultra Option Income Strategy ETF), in the Financial Services sector, (Asset Management - Income industry), listed on AMEX.
The YieldMax Ultra Option Income Strategy ETF (ULTY) is an actively managed exchange-traded fund that seeks to generate current income through a diversified portfolio of covered call strategies. The fund typically invests across 15 to 30 underlying securities, selected primarily on the basis of implied volatility levels. ULTY provides direct or indirect exposure to the share price performance of the underlying securities, subject to a cap on potential gains. The portfolio is reviewed and adjusted regularly, with positions increased, reduced, or replaced as market conditions evolve.
ULTY (YieldMax Ultra Option Income Strategy ETF) trades in the Financial Services sector, specifically Asset Management - Income, with a market capitalization of approximately $2.08B, a beta of 1.44 versus the broader market, a 52-week range of 29.29-64.6, average daily share volume of 669K, a public-listing history dating back to 2024. These structural characteristics shape how ULTY etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.44 indicates ULTY has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. ULTY pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on ULTY?
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 ULTY snapshot
As of May 15, 2026, spot at $31.57, ATM IV 21.10%, IV rank 4.13%, expected move 6.05%. The butterfly on ULTY 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 ULTY specifically: ULTY IV at 21.10% is on the cheap side of its 1-year range, which favors premium-buying structures like a ULTY butterfly, with a market-implied 1-standard-deviation move of approximately 6.05% (roughly $1.91 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 ULTY expiries trade a higher absolute premium for lower per-day decay. Position sizing on ULTY should anchor to the underlying notional of $31.57 per share and to the trader's directional view on ULTY etf.
ULTY butterfly setup
The ULTY 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 ULTY near $31.57, the first option leg uses a $30.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ULTY 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 ULTY shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $30.00 | $1.58 |
| Sell 2 | Call | $32.00 | $0.33 |
| Buy 1 | Call | $33.00 | $0.10 |
ULTY butterfly risk and reward
- Net Premium / Debit
- -$102.50
- Max Profit (per contract)
- $92.41
- Max Loss (per contract)
- -$102.50
- Breakeven(s)
- $31.03, $32.98
- Risk / Reward Ratio
- 0.902
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.
ULTY butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on ULTY. 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% | -$102.50 |
| $6.99 | -77.9% | -$102.50 |
| $13.97 | -55.8% | -$102.50 |
| $20.95 | -33.6% | -$102.50 |
| $27.93 | -11.5% | -$102.50 |
| $34.91 | +10.6% | -$2.50 |
| $41.89 | +32.7% | -$2.50 |
| $48.86 | +54.8% | -$2.50 |
| $55.84 | +76.9% | -$2.50 |
| $62.82 | +99.0% | -$2.50 |
When traders use butterfly on ULTY
Butterflies on ULTY are pinning bets - traders use them when they expect ULTY 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.
ULTY thesis for this butterfly
The market-implied 1-standard-deviation range for ULTY extends from approximately $29.66 on the downside to $33.48 on the upside. A ULTY long call butterfly is a pinning play: it pays maximum at the middle strike if ULTY settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current ULTY IV rank near 4.13% 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 ULTY at 21.10%. As a Financial Services name, ULTY options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ULTY-specific events.
ULTY 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. ULTY positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ULTY alongside the broader basket even when ULTY-specific fundamentals are unchanged. Always rebuild the position from current ULTY chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on ULTY?
- A butterfly on ULTY is the butterfly strategy applied to ULTY (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 ULTY etf trading near $31.57, the strikes shown on this page are snapped to the nearest listed ULTY chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ULTY 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 ULTY butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 21.10%), the computed maximum profit is $92.41 per contract and the computed maximum loss is -$102.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a ULTY butterfly?
- The breakeven for the ULTY butterfly priced on this page is roughly $31.03 and $32.98 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 ULTY market-implied 1-standard-deviation expected move is approximately 6.05%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on ULTY?
- Butterflies on ULTY are pinning bets - traders use them when they expect ULTY 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 ULTY implied volatility affect this butterfly?
- ULTY ATM IV is at 21.10% with IV rank near 4.13%, 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.