CVGW Butterfly Strategy
CVGW (Calavo Growers, Inc.), in the Consumer Defensive sector, (Food Distribution industry), listed on NASDAQ.
Calavo Growers, Inc. markets and distributes avocados, prepared avocados, and other perishable foods to retail grocery and foodservice customers, club stores, mass merchandisers, food distributors, and wholesale customers worldwide. It operates in three segments: Fresh Products, Calavo Foods, and Renaissance Food Group (RFG). The Fresh products segment distributes avocados and other fresh produce products comprising tomatoes and papayas; and procures avocados grown in California, Mexico, Peru, and Colombia. The Calavo Foods segment is involved in purchasing, processing, packaging, and distributing prepared avocado products, including guacamole and salsa. The RFG segment manufactures, markets, and distributes fresh-cut fruits and vegetables, fresh prepared entrée salads, wraps, sandwiches, and fresh snacking products, as well as ready-to-heat entrees, other hot bar and various deli items, meals kits and related components, and salad kits. The company offers its products under the Calavo and RFG brands, and related logos; and Avo Fresco, Bueno, Calavo Gold, Calavo Salsa Lisa, Salsa Lisa, Celebrate the Taste, El Dorado, Fresh Ripe, Select, Taste of Paradise, The First Name in Avocados, Tico, Mfresh, Maui Fresh International, Triggered Avocados, ProRipeVIP, RIPE NOW!, Garden Highway Fresh Cut, Garden Highway, and Garden Highway Chef Essentials trademarks.
CVGW (Calavo Growers, Inc.) trades in the Consumer Defensive sector, specifically Food Distribution, with a market capitalization of approximately $480.8M, a trailing P/E of 29.84, a beta of 0.43 versus the broader market, a 52-week range of 18.4-28.98, average daily share volume of 283K, a public-listing history dating back to 2002, approximately 2K full-time employees. These structural characteristics shape how CVGW stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.43 indicates CVGW has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. CVGW pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on CVGW?
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 CVGW snapshot
As of May 15, 2026, spot at $26.62, ATM IV 46.80%, IV rank 6.91%, expected move 13.42%. The butterfly on CVGW 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 CVGW specifically: CVGW IV at 46.80% is on the cheap side of its 1-year range, which favors premium-buying structures like a CVGW butterfly, with a market-implied 1-standard-deviation move of approximately 13.42% (roughly $3.57 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 CVGW expiries trade a higher absolute premium for lower per-day decay. Position sizing on CVGW should anchor to the underlying notional of $26.62 per share and to the trader's directional view on CVGW stock.
CVGW butterfly setup
The CVGW 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 CVGW near $26.62, the first option leg uses a $25.29 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CVGW 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 CVGW shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $25.29 | N/A |
| Sell 2 | Call | $26.62 | N/A |
| Buy 1 | Call | $27.95 | N/A |
CVGW 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.
CVGW butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on CVGW. 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 CVGW
Butterflies on CVGW are pinning bets - traders use them when they expect CVGW 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.
CVGW thesis for this butterfly
The market-implied 1-standard-deviation range for CVGW extends from approximately $23.05 on the downside to $30.19 on the upside. A CVGW long call butterfly is a pinning play: it pays maximum at the middle strike if CVGW settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current CVGW IV rank near 6.91% 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 CVGW at 46.80%. As a Consumer Defensive name, CVGW options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CVGW-specific events.
CVGW 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. CVGW positions also carry Consumer Defensive sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move CVGW alongside the broader basket even when CVGW-specific fundamentals are unchanged. Always rebuild the position from current CVGW chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on CVGW?
- A butterfly on CVGW is the butterfly strategy applied to CVGW (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 CVGW stock trading near $26.62, the strikes shown on this page are snapped to the nearest listed CVGW chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are CVGW 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 CVGW butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 46.80%), 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 CVGW butterfly?
- The breakeven for the CVGW 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 CVGW market-implied 1-standard-deviation expected move is approximately 13.42%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on CVGW?
- Butterflies on CVGW are pinning bets - traders use them when they expect CVGW 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 CVGW implied volatility affect this butterfly?
- CVGW ATM IV is at 46.80% with IV rank near 6.91%, 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.