How are ADTN 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 ADTN butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 72.80%), the computed maximum profit is $45.00 per contract and the computed maximum loss is -$55.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a ADTN butterfly?

The breakeven for the ADTN butterfly priced on this page is roughly $8.45 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The ADTN market-implied 1-standard-deviation expected move in the same options snapshot is approximately 20.87%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current ADTN implied volatility affect this butterfly?

ADTN ATM IV is at 72.80% with IV rank near 17.85%, 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.

ADTN Butterfly Strategy

ADTN (ADTRAN Holdings Inc.), in the Technology sector, (Communication Equipment industry), listed on NASDAQ.

ADTRAN Holdings, Inc. develops and provides network access solutions. It is a global provider of open, disaggregated networking and communications equipment that enable voice, data, video and internet communications across any network infrastructure. It operates through the Network Solutions and Services and Support segments. The Network Solutions segment offers hardware and software products. The Service and Support segment manages a comprehensive portfolio of network design, implementation, maintenance and cloud-hosted services supporting its subscriber, access and aggregation, and optical networking solutions. The company was founded in 1985 and is headquartered in Huntsville, AL.

ADTN (ADTRAN Holdings Inc.) trades in the Technology sector, specifically Communication Equipment, with a market capitalization of approximately $660.9M, a beta of 1.49 versus the broader market, a 52-week range of 7.11-19.98, average daily share volume of 2.6M, a public-listing history dating back to 1994, approximately 3K full-time employees. These structural characteristics shape how ADTN stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.49 indicates ADTN has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. ADTN pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on ADTN?

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.

ADTN snapshot

As of August 14, 2026, spot at $8.39, ATM IV 72.80%, IV rank 17.85%, expected move 20.87%. The butterfly on ADTN below is built from the August 14, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.

Why this butterfly structure on ADTN specifically: ADTN IV at 72.80% is on the cheap side of its 1-year range, which favors premium-buying structures like a ADTN butterfly, with a market-implied 1-standard-deviation move of approximately 20.87% (roughly $1.75 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated ADTN expiries trade a higher absolute premium for lower per-day decay. Position sizing on ADTN should anchor to the underlying notional of $8.39 per share and to the trader's directional view on ADTN stock.

ADTN butterfly setup

The ADTN butterfly below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With ADTN at $8.39 on that close, the first option leg uses a $8.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ADTN chain at a 35-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 ADTN shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$8.00	$0.90
Sell 2	Call	$8.00	$0.90
Buy 1	Call	$9.00	$0.45

ADTN butterfly risk and reward

Net Premium / Debit: +$45.00
Max Profit (per contract): $45.00
Max Loss (per contract): -$55.00
Breakeven(s): $8.45
Risk / Reward Ratio: 0.818

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.

ADTN butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on ADTN. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-99.9%	+$45.00
$1.86	-77.8%	+$45.00
$3.72	-55.7%	+$45.00
$5.57	-33.6%	+$45.00
$7.43	-11.5%	+$45.00
$9.28	+10.6%	-$55.00
$11.13	+32.7%	-$55.00
$12.99	+54.8%	-$55.00
$14.84	+76.9%	-$55.00
$16.70	+99.0%	-$55.00

When traders use butterfly on ADTN

Butterflies on ADTN are pinning bets - traders use them when they expect ADTN 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.

ADTN thesis for this butterfly

The market-implied 1-standard-deviation range for ADTN extends from approximately $6.64 on the downside to $10.14 on the upside. A ADTN long call butterfly is a pinning play: it pays maximum at the middle strike if ADTN settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current ADTN IV rank near 17.85% 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 ADTN at 72.80%. As a Technology name, ADTN options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ADTN-specific events.

ADTN 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. ADTN positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ADTN alongside the broader basket even when ADTN-specific fundamentals are unchanged. Always rebuild the position from current ADTN chain quotes before placing a trade.

Frequently asked questions

What is a butterfly on ADTN?: A butterfly on ADTN is the butterfly strategy applied to ADTN (stock). 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 ADTN stock at $8.39 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed ADTN chain strike and the premiums come straight from that session's bid/ask midpoint.
How are ADTN 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 ADTN butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 72.80%), the computed maximum profit is $45.00 per contract and the computed maximum loss is -$55.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a ADTN butterfly?: The breakeven for the ADTN butterfly priced on this page is roughly $8.45 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The ADTN market-implied 1-standard-deviation expected move in the same options snapshot is approximately 20.87%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on ADTN?: Butterflies on ADTN are pinning bets - traders use them when they expect ADTN 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 ADTN implied volatility affect this butterfly?: ADTN ATM IV is at 72.80% with IV rank near 17.85%, 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.