How are AFRM 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 AFRM butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 68.09%), the computed maximum profit is $368.74 per contract and the computed maximum loss is -$5.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a AFRM butterfly?

The breakeven for the AFRM butterfly priced on this page is roughly $74.83 and $83.37 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 AFRM market-implied 1-standard-deviation expected move in the same options snapshot is approximately 19.52%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current AFRM implied volatility affect this butterfly?

AFRM ATM IV is at 68.09% with IV rank near 40.50%, 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.

AFRM Butterfly Strategy

AFRM (Affirm Holdings, Inc.), in the Financial Services sector, (Financial - Credit Services industry), listed on NASDAQ.

Affirm Holdings, Inc. provides a digital and mobile-first commerce platform that operates across the United States and Canada. This platform offers consumers a point-of-sale financing solution, delivers various tools for merchants, and includes a dedicated mobile application for users. Leveraging its payment network and partnerships with originating banks, the company enables customers to spread the cost of their purchases over time, with payment terms ranging from a single month up to forty-eight months. By June 30, 2021, approximately 29,000 merchants had integrated Affirm's services, representing a diverse array of businesses from small enterprises and large corporations to direct-to-consumer brands and traditional physical stores. These businesses span numerous industries, including sporting goods, home furnishings, travel, apparel, accessories, consumer electronics, and jewelry. Affirm was founded in 2012 and is based in San Francisco, California.

AFRM (Affirm Holdings, Inc.) trades in the Financial Services sector, specifically Financial - Credit Services, with a market capitalization of approximately $24.58B, a trailing P/E of 64.71, a beta of 3.62 versus the broader market, a 52-week range of 42.095-100, average daily share volume of 4.6M, a public-listing history dating back to 2021, approximately 2K full-time employees. These structural characteristics shape how AFRM stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 3.62 indicates AFRM has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. The trailing P/E of 64.71 is on the rich side, which tends to correlate with higher earnings-window IV expansion as the market debates whether forward growth supports the multiple.

What is a butterfly on AFRM?

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.

AFRM snapshot

As of August 14, 2026, spot at $79.13, ATM IV 68.09%, IV rank 40.50%, expected move 19.52%. The butterfly on AFRM 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 28-day expiry.

Why this butterfly structure on AFRM specifically: AFRM IV at 68.09% 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 19.52% (roughly $15.45 on the underlying). The 28-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated AFRM expiries trade a higher absolute premium for lower per-day decay. Position sizing on AFRM should anchor to the underlying notional of $79.13 per share and to the trader's directional view on AFRM stock.

AFRM butterfly setup

The AFRM 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 AFRM at $79.13 on that close, the first option leg uses a $75.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AFRM chain at a 28-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 AFRM shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$75.00	$8.10
Sell 2	Call	$79.00	$6.05
Buy 1	Call	$83.00	$4.05

AFRM butterfly risk and reward

Net Premium / Debit: -$5.00
Max Profit (per contract): $368.74
Max Loss (per contract): -$5.00
Breakeven(s): $74.83, $83.37
Risk / Reward Ratio: 73.748

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.

AFRM butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on AFRM. 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	-100.0%	-$5.00
$17.50	-77.9%	-$5.00
$35.00	-55.8%	-$5.00
$52.49	-33.7%	-$5.00
$69.99	-11.6%	-$5.00
$87.48	+10.6%	-$5.00
$104.98	+32.7%	-$5.00
$122.47	+54.8%	-$5.00
$139.97	+76.9%	-$5.00
$157.46	+99.0%	-$5.00

When traders use butterfly on AFRM

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

AFRM thesis for this butterfly

The market-implied 1-standard-deviation range for AFRM extends from approximately $63.68 on the downside to $94.58 on the upside. A AFRM long call butterfly is a pinning play: it pays maximum at the middle strike if AFRM settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current AFRM IV rank near 40.50% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on AFRM should anchor more to the directional view and the expected-move geometry. As a Financial Services name, AFRM options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AFRM-specific events.

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

Frequently asked questions

What is a butterfly on AFRM?: A butterfly on AFRM is the butterfly strategy applied to AFRM (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 AFRM stock at $79.13 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed AFRM chain strike and the premiums come straight from that session's bid/ask midpoint.
How are AFRM 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 AFRM butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 68.09%), the computed maximum profit is $368.74 per contract and the computed maximum loss is -$5.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a AFRM butterfly?: The breakeven for the AFRM butterfly priced on this page is roughly $74.83 and $83.37 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 AFRM market-implied 1-standard-deviation expected move in the same options snapshot is approximately 19.52%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on AFRM?: Butterflies on AFRM are pinning bets - traders use them when they expect AFRM 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 AFRM implied volatility affect this butterfly?: AFRM ATM IV is at 68.09% with IV rank near 40.50%, 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.