ARMP Butterfly Strategy
ARMP (Armata Pharmaceuticals, Inc.), in the Healthcare sector, (Biotechnology industry), listed on AMEX.
Armata Pharmaceuticals, Inc. operates as a clinical-stage biotechnology enterprise with a global focus on creating specialized bacteriophage therapeutics. Its primary objective is to tackle infections that have developed resistance to standard antibiotics. The company's innovative treatments are developed utilizing its exclusive bacteriophage-based technology platform. Within its product pipeline are several significant candidates: AP-SA02, designed for the treatment of Staphylococcus aureus bacteremia; AP-PA02, targeting Pseudomonas aeruginosa; and AP-PA03, intended to address pneumonia. Additionally, Armata has forged a collaborative agreement with Merck & Co. to further the development of synthetic bacteriophage candidates aimed at specific, yet unrevealed, infectious disease agents. The company's main offices are located in Marina del Rey, California.
ARMP (Armata Pharmaceuticals, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $158.2M, a beta of 1.31 versus the broader market, a 52-week range of 2.39-16.34, average daily share volume of 121K, a public-listing history dating back to 1994, approximately 61 full-time employees. These structural characteristics shape how ARMP stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.31 indicates ARMP has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a butterfly on ARMP?
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.
ARMP snapshot
As of August 14, 2026, spot at $4.59, ATM IV 363.30%, IV rank 72.63%, expected move 104.16%. The butterfly on ARMP below is built from the 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 ARMP specifically: ARMP IV at 363.30% is rich versus its 1-year range, which makes a premium-buying ARMP butterfly relatively expensive in absolute-cost terms, with a market-implied 1-standard-deviation move of approximately 104.16% (roughly $4.78 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 ARMP expiries trade a higher absolute premium for lower per-day decay. Position sizing on ARMP should anchor to the underlying notional of $4.59 per share and to the trader's directional view on ARMP stock.
ARMP butterfly setup
The ARMP 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 ARMP at $4.59 on that close, the first option leg uses a $4.36 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ARMP 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 ARMP shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $4.36 | N/A |
| Sell 2 | Call | $4.59 | N/A |
| Buy 1 | Call | $4.82 | N/A |
ARMP 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.
ARMP butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on ARMP. 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 ARMP
Butterflies on ARMP are pinning bets - traders use them when they expect ARMP 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.
ARMP thesis for this butterfly
The market-implied 1-standard-deviation range for ARMP extends from approximately $-0.19 on the downside to $9.37 on the upside. A ARMP long call butterfly is a pinning play: it pays maximum at the middle strike if ARMP settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current ARMP IV rank near 72.63% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on ARMP at 363.30%. As a Healthcare name, ARMP options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ARMP-specific events.
ARMP 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. ARMP positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ARMP alongside the broader basket even when ARMP-specific fundamentals are unchanged. Always rebuild the position from current ARMP chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on ARMP?
- A butterfly on ARMP is the butterfly strategy applied to ARMP (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 ARMP stock at $4.59 on the most recent close, the strikes shown on this page are snapped to the nearest listed ARMP chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are ARMP 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 ARMP butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 363.30%), 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 ARMP butterfly?
- The breakeven for the ARMP butterfly priced on this page is no defined breakeven on the modeled curve at expiration, derived from the 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 ARMP market-implied 1-standard-deviation expected move in the same options snapshot is approximately 104.16%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on ARMP?
- Butterflies on ARMP are pinning bets - traders use them when they expect ARMP 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 ARMP implied volatility affect this butterfly?
- ARMP ATM IV is at 363.30% with IV rank near 72.63%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.