YOLO Butterfly Strategy
YOLO (AdvisorShares Pure Cannabis ETF), in the Financial Services sector, (Asset Management industry), listed on AMEX.
Long-Term Upside Potential – The emergence of select cannabis securities and their long-term growth potential adds a compelling element for investors seeking pure cannabis exposure and a potential high-growth complement to a broad-based equity allocation. First Active ETF with Dedicated Cannabis Exposure – YOLO became the first actively managed ETF with dedicated cannabis exposure available in the U.S., which carries inherent advantages. YOLO can adjust its portfolio more quickly than a passive index-based strategy – an important attribute in a rapidly evolving cannabis marketplace that can witness fluctuations and changes among tradeable equities and an influx of new stock issues. Experienced Portfolio Management Team – YOLO’s portfolio management team carries deep experience in the capital markets and a well-established expertise of investing in highly-regulated areas in the equity markets including cannabis. Their risk management and selective approach is an essential feature of YOLO, which does not blindly invest by following a market-cap-weighted index like other cannabis-related ETF offerings.
YOLO (AdvisorShares Pure Cannabis ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $29.5M, a beta of 0.89 versus the broader market, a 52-week range of 1.75-4.526, average daily share volume of 58K, a public-listing history dating back to 2019. These structural characteristics shape how YOLO etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.89 places YOLO roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. YOLO pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on YOLO?
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 YOLO snapshot
As of May 15, 2026, spot at $2.86, ATM IV 106.60%, IV rank 18.29%, expected move 30.56%. The butterfly on YOLO 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 YOLO specifically: YOLO IV at 106.60% is on the cheap side of its 1-year range, which favors premium-buying structures like a YOLO butterfly, with a market-implied 1-standard-deviation move of approximately 30.56% (roughly $0.87 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 YOLO expiries trade a higher absolute premium for lower per-day decay. Position sizing on YOLO should anchor to the underlying notional of $2.86 per share and to the trader's directional view on YOLO etf.
YOLO butterfly setup
The YOLO 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 YOLO near $2.86, the first option leg uses a $2.72 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed YOLO 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 YOLO shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $2.72 | N/A |
| Sell 2 | Call | $2.86 | N/A |
| Buy 1 | Call | $3.00 | N/A |
YOLO 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.
YOLO butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on YOLO. 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 YOLO
Butterflies on YOLO are pinning bets - traders use them when they expect YOLO 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.
YOLO thesis for this butterfly
The market-implied 1-standard-deviation range for YOLO extends from approximately $1.99 on the downside to $3.73 on the upside. A YOLO long call butterfly is a pinning play: it pays maximum at the middle strike if YOLO settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current YOLO IV rank near 18.29% 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 YOLO at 106.60%. As a Financial Services name, YOLO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to YOLO-specific events.
YOLO 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. YOLO positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move YOLO alongside the broader basket even when YOLO-specific fundamentals are unchanged. Always rebuild the position from current YOLO chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on YOLO?
- A butterfly on YOLO is the butterfly strategy applied to YOLO (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 YOLO etf trading near $2.86, the strikes shown on this page are snapped to the nearest listed YOLO chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are YOLO 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 YOLO butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 106.60%), 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 YOLO butterfly?
- The breakeven for the YOLO 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 YOLO market-implied 1-standard-deviation expected move is approximately 30.56%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on YOLO?
- Butterflies on YOLO are pinning bets - traders use them when they expect YOLO 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 YOLO implied volatility affect this butterfly?
- YOLO ATM IV is at 106.60% with IV rank near 18.29%, 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.