ALXO Butterfly Strategy
ALXO (ALX Oncology Holdings Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
ALX Oncology Holdings Inc., a clinical-stage immuno-oncology company, focuses on developing therapies for cancer patients in the United States. The company’s lead product candidate is Evorpacept, a CD47 blocking therapeutic biologic development as a combination therapy with other anti-cancer agents, including ASPEN-06, under phase 2 clinical study for treating Gastric/GEJ cancer. It has collaboration agreement for Evorpacept combination programs comprising Jazz Pharmaceuticals plc for zanidatamab, under phase 1b/2 trial for the treatment of breast cancer and other solid tumors; HER2 with an ADC, fam-trastuzumab deruxtecan-nxki, under phase 1 trial for the treatment of patients with breast cancer; ALX2004, under phase 1 clinical trial for treating solid tumors; MD Anderson Cancer Center with rituximab and lenalidomide for the treatment of patients with indolent and aggressive NHL; and Sanofi with isatuximab and dexamethasone, under phase 1/2 trial for the treatment of patients with relapsed or refractory multiple myeloma. It has license agreements with Board of Trustees of Leland Stanford Junior University. The company was incorporated in 2015 and is headquartered in South San Francisco, California.
ALXO (ALX Oncology Holdings Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $274.5M, a beta of 0.45 versus the broader market, a 52-week range of 0.41-2.66, average daily share volume of 1.4M, a public-listing history dating back to 2020, approximately 43 full-time employees. These structural characteristics shape how ALXO stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.45 indicates ALXO has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.
What is a butterfly on ALXO?
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 ALXO snapshot
As of June 30, 2026, spot at $2.07, ATM IV 233.70%, IV rank 45.61%, expected move 67.00%. The butterfly on ALXO 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 17-day expiry.
Why this butterfly structure on ALXO specifically: ALXO IV at 233.70% 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 67.00% (roughly $1.39 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated ALXO expiries trade a higher absolute premium for lower per-day decay. Position sizing on ALXO should anchor to the underlying notional of $2.07 per share and to the trader's directional view on ALXO stock.
ALXO butterfly setup
The ALXO 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 ALXO near $2.07, the first option leg uses a $1.97 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ALXO chain at a 17-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 ALXO shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $1.97 | N/A |
| Sell 2 | Call | $2.07 | N/A |
| Buy 1 | Call | $2.17 | N/A |
ALXO 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.
ALXO butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on ALXO. 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 ALXO
Butterflies on ALXO are pinning bets - traders use them when they expect ALXO 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.
ALXO thesis for this butterfly
The market-implied 1-standard-deviation range for ALXO extends from approximately $0.68 on the downside to $3.46 on the upside. A ALXO long call butterfly is a pinning play: it pays maximum at the middle strike if ALXO settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current ALXO IV rank near 45.61% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on ALXO should anchor more to the directional view and the expected-move geometry. As a Healthcare name, ALXO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ALXO-specific events.
ALXO 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. ALXO positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ALXO alongside the broader basket even when ALXO-specific fundamentals are unchanged. Always rebuild the position from current ALXO chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on ALXO?
- A butterfly on ALXO is the butterfly strategy applied to ALXO (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 ALXO stock trading near $2.07, the strikes shown on this page are snapped to the nearest listed ALXO chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ALXO 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 ALXO butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 233.70%), 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 ALXO butterfly?
- The breakeven for the ALXO 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 ALXO market-implied 1-standard-deviation expected move is approximately 67.00%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on ALXO?
- Butterflies on ALXO are pinning bets - traders use them when they expect ALXO 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 ALXO implied volatility affect this butterfly?
- ALXO ATM IV is at 233.70% with IV rank near 45.61%, 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.