AMR Butterfly Strategy
AMR (Alpha Metallurgical Resources, Inc.), in the Energy sector, (Coal industry), listed on NYSE.
Alpha Metallurgical Resources, Inc., a mining company, produces, processes, and sells met and thermal coal in Virginia and West Virginia. The company provides metallurgical coal products. It operates nineteen active mines and eight active coal preparation and load-out facilities. The company was formerly known as Contura Energy, Inc. and changed its name to Alpha Metallurgical Resources, Inc. in February 2021. Alpha Metallurgical Resources, Inc. was incorporated in 2016 and is headquartered in Bristol, Tennessee.
AMR (Alpha Metallurgical Resources, Inc.) trades in the Energy sector, specifically Coal, with a market capitalization of approximately $2.03B, a beta of 0.65 versus the broader market, a 52-week range of 133.64-253.82, average daily share volume of 264K, a public-listing history dating back to 2021, approximately 4K full-time employees. These structural characteristics shape how AMR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.65 indicates AMR has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. AMR pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on AMR?
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.
AMR snapshot
As of August 14, 2026, spot at $165.36, ATM IV 55.10%, IV rank 21.78%, expected move 15.80%. The butterfly on AMR 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 AMR specifically: AMR IV at 55.10% is on the cheap side of its 1-year range, which favors premium-buying structures like a AMR butterfly, with a market-implied 1-standard-deviation move of approximately 15.80% (roughly $26.12 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 AMR expiries trade a higher absolute premium for lower per-day decay. Position sizing on AMR should anchor to the underlying notional of $165.36 per share and to the trader's directional view on AMR stock.
AMR butterfly setup
The AMR 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 AMR at $165.36 on that close, the first option leg uses a $155.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AMR 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 AMR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $155.00 | $17.45 |
| Sell 2 | Call | $165.00 | $11.95 |
| Buy 1 | Call | $175.00 | $7.75 |
AMR butterfly risk and reward
- Net Premium / Debit
- -$130.00
- Max Profit (per contract)
- $823.41
- Max Loss (per contract)
- -$130.00
- Breakeven(s)
- $156.30, $173.70
- Risk / Reward Ratio
- 6.334
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.
AMR butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on AMR. 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% | -$130.00 |
| $36.57 | -77.9% | -$130.00 |
| $73.13 | -55.8% | -$130.00 |
| $109.69 | -33.7% | -$130.00 |
| $146.25 | -11.6% | -$130.00 |
| $182.81 | +10.6% | -$130.00 |
| $219.38 | +32.7% | -$130.00 |
| $255.94 | +54.8% | -$130.00 |
| $292.50 | +76.9% | -$130.00 |
| $329.06 | +99.0% | -$130.00 |
When traders use butterfly on AMR
Butterflies on AMR are pinning bets - traders use them when they expect AMR 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.
AMR thesis for this butterfly
The market-implied 1-standard-deviation range for AMR extends from approximately $139.24 on the downside to $191.48 on the upside. A AMR long call butterfly is a pinning play: it pays maximum at the middle strike if AMR settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current AMR IV rank near 21.78% 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 AMR at 55.10%. As a Energy name, AMR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AMR-specific events.
AMR 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. AMR positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move AMR alongside the broader basket even when AMR-specific fundamentals are unchanged. Always rebuild the position from current AMR chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on AMR?
- A butterfly on AMR is the butterfly strategy applied to AMR (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 AMR stock at $165.36 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed AMR chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are AMR 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 AMR butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 55.10%), the computed maximum profit is $823.41 per contract and the computed maximum loss is -$130.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a AMR butterfly?
- The breakeven for the AMR butterfly priced on this page is roughly $156.30 and $173.70 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 AMR market-implied 1-standard-deviation expected move in the same options snapshot is approximately 15.80%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on AMR?
- Butterflies on AMR are pinning bets - traders use them when they expect AMR 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 AMR implied volatility affect this butterfly?
- AMR ATM IV is at 55.10% with IV rank near 21.78%, 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.