XOMO Butterfly Strategy
XOMO (YieldMax XOM Option Income Strategy ETF), in the Financial Services sector, (Asset Management - Income industry), listed on AMEX.
The YieldMax XOM Option Income Strategy ETF (XOMO) is an actively managed exchange-traded fund that seeks to generate weekly income by selling call options or call spreads on XOM. The strategy is designed to capture option premiums while providing participation in the share price appreciation of XOM.
XOMO (YieldMax XOM Option Income Strategy ETF) trades in the Financial Services sector, specifically Asset Management - Income, with a market capitalization of approximately $36.3M, a beta of -0.24 versus the broader market, a 52-week range of 11.324-14.14, average daily share volume of 212K, a public-listing history dating back to 2023. These structural characteristics shape how XOMO etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of -0.24 indicates XOMO has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. XOMO pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on XOMO?
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 XOMO snapshot
As of May 15, 2026, spot at $12.16, ATM IV 158.30%, IV rank 38.09%, expected move 45.38%. The butterfly on XOMO 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 XOMO specifically: XOMO IV at 158.30% 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 45.38% (roughly $5.52 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 XOMO expiries trade a higher absolute premium for lower per-day decay. Position sizing on XOMO should anchor to the underlying notional of $12.16 per share and to the trader's directional view on XOMO etf.
XOMO butterfly setup
The XOMO 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 XOMO near $12.16, the first option leg uses a $11.55 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed XOMO 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 XOMO shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $11.55 | N/A |
| Sell 2 | Call | $12.16 | N/A |
| Buy 1 | Call | $12.77 | N/A |
XOMO 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.
XOMO butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on XOMO. 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 XOMO
Butterflies on XOMO are pinning bets - traders use them when they expect XOMO 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.
XOMO thesis for this butterfly
The market-implied 1-standard-deviation range for XOMO extends from approximately $6.64 on the downside to $17.68 on the upside. A XOMO long call butterfly is a pinning play: it pays maximum at the middle strike if XOMO settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current XOMO IV rank near 38.09% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on XOMO should anchor more to the directional view and the expected-move geometry. As a Financial Services name, XOMO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to XOMO-specific events.
XOMO 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. XOMO positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move XOMO alongside the broader basket even when XOMO-specific fundamentals are unchanged. Always rebuild the position from current XOMO chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on XOMO?
- A butterfly on XOMO is the butterfly strategy applied to XOMO (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 XOMO etf trading near $12.16, the strikes shown on this page are snapped to the nearest listed XOMO chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are XOMO 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 XOMO butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 158.30%), 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 XOMO butterfly?
- The breakeven for the XOMO 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 XOMO market-implied 1-standard-deviation expected move is approximately 45.38%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on XOMO?
- Butterflies on XOMO are pinning bets - traders use them when they expect XOMO 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 XOMO implied volatility affect this butterfly?
- XOMO ATM IV is at 158.30% with IV rank near 38.09%, 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.