CSW Butterfly Strategy
CSW (CSW Industrials, Inc.), in the Industrials sector, (Industrial - Machinery industry), listed on NYSE.
CSW Industrials, Inc. provides various industrial products in the United States and internationally. It operates through three segments: Contractor Solutions, Engineered Building Solutions, and Specialized Reliability Solutions. The Contractor Solutions segment offers condensate pads, pans, and pumps; condensate switches and traps; drain management system; drain waste and vent mechanical products; ductless mini-split systems installation support tools and accessories; HVAC electrical protection, installation supplies, and maintenance chemicals; evaporator coils and air handlers; grilles, registers, diffusers and vents; line set covers; load management systems; refrigerant caps; solvents, cements, traps, and thread sealants; surge protection products; and wire pulling head tools. This segment sells its products under the AquaGuard, Aspen, Clean Check, Cover Guard, Desolv, Dust Free, EZ Trap, Falcon Stainless, Fortress, Goliath, G-O-N, Guardian Drain Lock, Hubsett, Kickstart, Leak Freeze, No. 5, Novent, PF WaterWorks, PRO-Fit, PSP Products, RectorSeal, Safe-T-Switch, Shoemaker Manufacturing, Slimduct, SureSeal, TRU-BLU, and TRUaire brands. The Engineered Building Solutions segment offers architectural railings and metals; fire and smoke protection, and fire stopping solutions; and pre-engineered and custom architectural building components under the Balco, BlazeSeal, Greco, IllumiTread, Metacaulk, MetaflexPro, and Smoke Guard brands. The Specialized Reliability Solutions segment provides compounds, lubricants, and sealants; industrial maintenance and repair, anti-seize, contamination control, and desiccant breather filtration products; lubricant management systems; operation solutions; and rail friction modifiers under the AccuTrack, Air Sentry, BioRail, Deacon, Envirolube, Extreme, Gearmate, Jet-Lube, Kopr-Kote, Matrix, NCS-30 ECF, OilSafe, RailArmor, Run-N-Seal ECF, TOR Armor, and Whitmore brands.
CSW (CSW Industrials, Inc.) trades in the Industrials sector, specifically Industrial - Machinery, with a market capitalization of approximately $4.34B, a trailing P/E of 33.95, a beta of 0.88 versus the broader market, a 52-week range of 230.45-338.02, average daily share volume of 133K, a public-listing history dating back to 2015, approximately 3K full-time employees. These structural characteristics shape how CSW stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.88 places CSW roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. CSW pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on CSW?
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 CSW snapshot
As of May 15, 2026, spot at $256.39, ATM IV 40.90%, IV rank 46.93%, expected move 11.73%. The butterfly on CSW 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 63-day expiry.
Why this butterfly structure on CSW specifically: CSW IV at 40.90% 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 11.73% (roughly $30.06 on the underlying). The 63-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated CSW expiries trade a higher absolute premium for lower per-day decay. Position sizing on CSW should anchor to the underlying notional of $256.39 per share and to the trader's directional view on CSW stock.
CSW butterfly setup
The CSW 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 CSW near $256.39, the first option leg uses a $240.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CSW chain at a 63-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 CSW shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $240.00 | $27.95 |
| Sell 2 | Call | $260.00 | $15.95 |
| Buy 1 | Call | $270.00 | $11.00 |
CSW butterfly risk and reward
- Net Premium / Debit
- -$705.00
- Max Profit (per contract)
- $1,268.99
- Max Loss (per contract)
- -$705.00
- Breakeven(s)
- $247.05
- Risk / Reward Ratio
- 1.800
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.
CSW butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on CSW. 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% | -$705.00 |
| $56.70 | -77.9% | -$705.00 |
| $113.39 | -55.8% | -$705.00 |
| $170.07 | -33.7% | -$705.00 |
| $226.76 | -11.6% | -$705.00 |
| $283.45 | +10.6% | +$295.00 |
| $340.14 | +32.7% | +$295.00 |
| $396.83 | +54.8% | +$295.00 |
| $453.52 | +76.9% | +$295.00 |
| $510.20 | +99.0% | +$295.00 |
When traders use butterfly on CSW
Butterflies on CSW are pinning bets - traders use them when they expect CSW 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.
CSW thesis for this butterfly
The market-implied 1-standard-deviation range for CSW extends from approximately $226.33 on the downside to $286.45 on the upside. A CSW long call butterfly is a pinning play: it pays maximum at the middle strike if CSW settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current CSW IV rank near 46.93% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on CSW should anchor more to the directional view and the expected-move geometry. As a Industrials name, CSW options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CSW-specific events.
CSW 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. CSW positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move CSW alongside the broader basket even when CSW-specific fundamentals are unchanged. Always rebuild the position from current CSW chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on CSW?
- A butterfly on CSW is the butterfly strategy applied to CSW (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 CSW stock trading near $256.39, the strikes shown on this page are snapped to the nearest listed CSW chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are CSW 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 CSW butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 40.90%), the computed maximum profit is $1,268.99 per contract and the computed maximum loss is -$705.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a CSW butterfly?
- The breakeven for the CSW butterfly priced on this page is roughly $247.05 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 CSW market-implied 1-standard-deviation expected move is approximately 11.73%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on CSW?
- Butterflies on CSW are pinning bets - traders use them when they expect CSW 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 CSW implied volatility affect this butterfly?
- CSW ATM IV is at 40.90% with IV rank near 46.93%, 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.