AMGN Butterfly Strategy
AMGN (Amgen Inc.), in the Healthcare sector, (Drug Manufacturers - General industry), listed on NASDAQ.
Amgen Inc., established in 1980 and headquartered in Thousand Oaks, California, is a global biotechnology leader focused on discovering, developing, manufacturing, and delivering groundbreaking human medicines. The company's scientific endeavors span several critical therapeutic categories, including inflammatory conditions, oncology and hematology, bone health, cardiovascular diseases, nephrology, and neuroscience. Its extensive portfolio features a range of significant pharmaceutical products. Notable examples include Enbrel, prescribed for conditions like plaque psoriasis, rheumatoid arthritis, and psoriatic arthritis; Neulasta, which helps cancer patients by reducing the risk of infection linked to a low white blood cell count; Prolia, utilized in postmenopausal women to combat osteoporosis; and Xgeva, designed to prevent skeletal-related complications. Otezla offers relief for adult patients suffering from plaque psoriasis, psoriatic arthritis, and oral ulcers associated with Behçet's disease. Aranesp addresses anemia and low red blood cell counts, while KYPROLIS is employed to treat patients with relapsed or refractory multiple myeloma.
AMGN (Amgen Inc.) trades in the Healthcare sector, specifically Drug Manufacturers - General, with a market capitalization of approximately $224.62B, a trailing P/E of 25.70, a beta of 0.40 versus the broader market, a 52-week range of 269.77-421.79, average daily share volume of 2.7M, a public-listing history dating back to 1983, approximately 32K full-time employees. These structural characteristics shape how AMGN stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.40 indicates AMGN has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. AMGN pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on AMGN?
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.
AMGN snapshot
As of August 14, 2026, spot at $414.61, ATM IV 24.11%, IV rank 31.37%, expected move 6.91%. The butterfly on AMGN 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 AMGN specifically: AMGN IV at 24.11% 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 6.91% (roughly $28.65 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 AMGN expiries trade a higher absolute premium for lower per-day decay. Position sizing on AMGN should anchor to the underlying notional of $414.61 per share and to the trader's directional view on AMGN stock.
AMGN butterfly setup
The AMGN 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 AMGN at $414.61 on that close, the first option leg uses a $395.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AMGN 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 AMGN shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $395.00 | $22.75 |
| Sell 2 | Call | $415.00 | $10.05 |
| Buy 1 | Call | $435.00 | $3.49 |
AMGN butterfly risk and reward
- Net Premium / Debit
- -$614.00
- Max Profit (per contract)
- $1,216.16
- Max Loss (per contract)
- -$614.00
- Breakeven(s)
- $401.14, $428.86
- Risk / Reward Ratio
- 1.981
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.
AMGN butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on AMGN. 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.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | -$614.00 |
| $91.68 | -77.9% | -$614.00 |
| $183.35 | -55.8% | -$614.00 |
| $275.02 | -33.7% | -$614.00 |
| $366.70 | -11.6% | -$614.00 |
| $458.37 | +10.6% | -$614.00 |
| $550.04 | +32.7% | -$614.00 |
| $641.71 | +54.8% | -$614.00 |
| $733.38 | +76.9% | -$614.00 |
| $825.05 | +99.0% | -$614.00 |
When traders use butterfly on AMGN
Butterflies on AMGN are pinning bets - traders use them when they expect AMGN 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.
AMGN thesis for this butterfly
The market-implied 1-standard-deviation range for AMGN extends from approximately $385.96 on the downside to $443.26 on the upside. A AMGN long call butterfly is a pinning play: it pays maximum at the middle strike if AMGN settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current AMGN IV rank near 31.37% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on AMGN should anchor more to the directional view and the expected-move geometry. As a Healthcare name, AMGN options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AMGN-specific events.
AMGN 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. AMGN positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move AMGN alongside the broader basket even when AMGN-specific fundamentals are unchanged. Always rebuild the position from current AMGN chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on AMGN?
- A butterfly on AMGN is the butterfly strategy applied to AMGN (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 AMGN stock at $414.61 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed AMGN chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are AMGN 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 AMGN butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 24.11%), the computed maximum profit is $1,216.16 per contract and the computed maximum loss is -$614.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a AMGN butterfly?
- The breakeven for the AMGN butterfly priced on this page is roughly $401.14 and $428.86 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 AMGN market-implied 1-standard-deviation expected move in the same options snapshot is approximately 6.91%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on AMGN?
- Butterflies on AMGN are pinning bets - traders use them when they expect AMGN 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 AMGN implied volatility affect this butterfly?
- AMGN ATM IV is at 24.11% with IV rank near 31.37%, 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.