BUR Butterfly Strategy
BUR (Burford Capital Limited), in the Financial Services sector, (Asset Management industry), listed on NYSE.
Burford Capital Limited, through its subsidiaries, provides legal finance products and services. The company offers asset management services, including core legal finance, complex strategies, and post-settlement finance. The company was incorporated in 2009 and is based in Saint Peter Port, Guernsey.
BUR (Burford Capital Limited) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $988.0M, a trailing P/E of 15.78, a beta of 1.08 versus the broader market, a 52-week range of 3.59-15.1, average daily share volume of 4.0M, a public-listing history dating back to 2020, approximately 160 full-time employees. These structural characteristics shape how BUR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.08 places BUR roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. BUR pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on BUR?
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 BUR snapshot
As of May 15, 2026, spot at $4.69, ATM IV 52.40%, IV rank 22.36%, expected move 15.02%. The butterfly on BUR 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 34-day expiry.
Why this butterfly structure on BUR specifically: BUR IV at 52.40% is on the cheap side of its 1-year range, which favors premium-buying structures like a BUR butterfly, with a market-implied 1-standard-deviation move of approximately 15.02% (roughly $0.70 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated BUR expiries trade a higher absolute premium for lower per-day decay. Position sizing on BUR should anchor to the underlying notional of $4.69 per share and to the trader's directional view on BUR stock.
BUR butterfly setup
The BUR 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 BUR near $4.69, the first option leg uses a $4.46 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed BUR chain at a 34-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 BUR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $4.46 | N/A |
| Sell 2 | Call | $4.69 | N/A |
| Buy 1 | Call | $4.92 | N/A |
BUR 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.
BUR butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on BUR. 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 BUR
Butterflies on BUR are pinning bets - traders use them when they expect BUR 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.
BUR thesis for this butterfly
The market-implied 1-standard-deviation range for BUR extends from approximately $3.99 on the downside to $5.39 on the upside. A BUR long call butterfly is a pinning play: it pays maximum at the middle strike if BUR settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current BUR IV rank near 22.36% 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 BUR at 52.40%. As a Financial Services name, BUR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to BUR-specific events.
BUR 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. BUR positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move BUR alongside the broader basket even when BUR-specific fundamentals are unchanged. Always rebuild the position from current BUR chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on BUR?
- A butterfly on BUR is the butterfly strategy applied to BUR (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 BUR stock trading near $4.69, the strikes shown on this page are snapped to the nearest listed BUR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are BUR 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 BUR butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 52.40%), 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 BUR butterfly?
- The breakeven for the BUR 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 BUR market-implied 1-standard-deviation expected move is approximately 15.02%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on BUR?
- Butterflies on BUR are pinning bets - traders use them when they expect BUR 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 BUR implied volatility affect this butterfly?
- BUR ATM IV is at 52.40% with IV rank near 22.36%, 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.