YMAG Butterfly Strategy
YMAG (YieldMax Magnificent 7 Fund of Option Income ETF), in the Financial Services sector, (Asset Management industry), listed on AMEX.
The YieldMax Magnificent 7 fund of Option Income ETFs (YMAG) is an actively managed exchange-trade fund that seeks to generate current income. As a “fund of funds,” YMAG primarily invests in YieldMax option income ETFs that provide exposure to the so-called “Magnificent 7” companies. Each underlying YieldMax ETF seeks to generate income while offering exposure to the share price of its respective company.
YMAG (YieldMax Magnificent 7 Fund of Option Income ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $315.2M, a beta of 1.07 versus the broader market, a 52-week range of 11.473-16.01, average daily share volume of 1.1M, a public-listing history dating back to 2024. These structural characteristics shape how YMAG etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.07 places YMAG roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. YMAG pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on YMAG?
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 YMAG snapshot
As of May 15, 2026, spot at $13.04, ATM IV 56.40%, IV rank 13.83%, expected move 3.78%. The butterfly on YMAG 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 YMAG specifically: YMAG IV at 56.40% is on the cheap side of its 1-year range, which favors premium-buying structures like a YMAG butterfly, with a market-implied 1-standard-deviation move of approximately 3.78% (roughly $0.49 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 YMAG expiries trade a higher absolute premium for lower per-day decay. Position sizing on YMAG should anchor to the underlying notional of $13.04 per share and to the trader's directional view on YMAG etf.
YMAG butterfly setup
The YMAG 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 YMAG near $13.04, the first option leg uses a $12.39 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed YMAG 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 YMAG shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $12.39 | N/A |
| Sell 2 | Call | $13.04 | N/A |
| Buy 1 | Call | $13.69 | N/A |
YMAG 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.
YMAG butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on YMAG. 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 YMAG
Butterflies on YMAG are pinning bets - traders use them when they expect YMAG 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.
YMAG thesis for this butterfly
The market-implied 1-standard-deviation range for YMAG extends from approximately $12.55 on the downside to $13.53 on the upside. A YMAG long call butterfly is a pinning play: it pays maximum at the middle strike if YMAG settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current YMAG IV rank near 13.83% 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 YMAG at 56.40%. As a Financial Services name, YMAG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to YMAG-specific events.
YMAG 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. YMAG positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move YMAG alongside the broader basket even when YMAG-specific fundamentals are unchanged. Always rebuild the position from current YMAG chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on YMAG?
- A butterfly on YMAG is the butterfly strategy applied to YMAG (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 YMAG etf trading near $13.04, the strikes shown on this page are snapped to the nearest listed YMAG chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are YMAG 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 YMAG butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 56.40%), 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 YMAG butterfly?
- The breakeven for the YMAG 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 YMAG market-implied 1-standard-deviation expected move is approximately 3.78%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on YMAG?
- Butterflies on YMAG are pinning bets - traders use them when they expect YMAG 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 YMAG implied volatility affect this butterfly?
- YMAG ATM IV is at 56.40% with IV rank near 13.83%, 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.