DNA Butterfly Strategy
DNA (Ginkgo Bioworks Holdings, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NYSE.
Ginkgo Bioworks Holdings, Inc., together with its subsidiaries, develops platform for cell programming. Its platform is used to program cells to enable biological production of products, such as novel therapeutics, food ingredients, and chemicals derived from petroleum. The company serves various end markets, including specialty chemicals, agriculture, food, consumer products, and pharmaceuticals. Ginkgo Bioworks has a partnership with Selecta Biosciences, Inc. to develop ImmTOR technology platform. Ginkgo Bioworks Holdings, Inc. was founded in 2008 and is headquartered in Boston, Massachusetts.
DNA (Ginkgo Bioworks Holdings, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $561.1M, a beta of 1.78 versus the broader market, a 52-week range of 5.37-17.58, average daily share volume of 1.2M, a public-listing history dating back to 2021, approximately 834 full-time employees. These structural characteristics shape how DNA stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.78 indicates DNA 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 DNA?
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 DNA snapshot
As of May 15, 2026, spot at $7.70, ATM IV 98.10%, IV rank 21.67%, expected move 28.12%. The butterfly on DNA 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 DNA specifically: DNA IV at 98.10% is on the cheap side of its 1-year range, which favors premium-buying structures like a DNA butterfly, with a market-implied 1-standard-deviation move of approximately 28.12% (roughly $2.17 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 DNA expiries trade a higher absolute premium for lower per-day decay. Position sizing on DNA should anchor to the underlying notional of $7.70 per share and to the trader's directional view on DNA stock.
DNA butterfly setup
The DNA 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 DNA near $7.70, the first option leg uses a $7.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed DNA 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 DNA shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $7.00 | $1.28 |
| Sell 2 | Call | $8.00 | $0.78 |
| Buy 1 | Call | $8.00 | $0.78 |
DNA butterfly risk and reward
- Net Premium / Debit
- -$50.00
- Max Profit (per contract)
- $50.00
- Max Loss (per contract)
- -$50.00
- Breakeven(s)
- $7.50
- Risk / Reward Ratio
- 1.000
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.
DNA butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on DNA. 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 | -99.9% | -$50.00 |
| $1.71 | -77.8% | -$50.00 |
| $3.41 | -55.7% | -$50.00 |
| $5.11 | -33.6% | -$50.00 |
| $6.82 | -11.5% | -$50.00 |
| $8.52 | +10.6% | +$50.00 |
| $10.22 | +32.7% | +$50.00 |
| $11.92 | +54.8% | +$50.00 |
| $13.62 | +76.9% | +$50.00 |
| $15.32 | +99.0% | +$50.00 |
When traders use butterfly on DNA
Butterflies on DNA are pinning bets - traders use them when they expect DNA 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.
DNA thesis for this butterfly
The market-implied 1-standard-deviation range for DNA extends from approximately $5.53 on the downside to $9.87 on the upside. A DNA long call butterfly is a pinning play: it pays maximum at the middle strike if DNA settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current DNA IV rank near 21.67% 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 DNA at 98.10%. As a Healthcare name, DNA options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to DNA-specific events.
DNA 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. DNA positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move DNA alongside the broader basket even when DNA-specific fundamentals are unchanged. Always rebuild the position from current DNA chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on DNA?
- A butterfly on DNA is the butterfly strategy applied to DNA (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 DNA stock trading near $7.70, the strikes shown on this page are snapped to the nearest listed DNA chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are DNA 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 DNA butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 98.10%), the computed maximum profit is $50.00 per contract and the computed maximum loss is -$50.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a DNA butterfly?
- The breakeven for the DNA butterfly priced on this page is roughly $7.50 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 DNA market-implied 1-standard-deviation expected move is approximately 28.12%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on DNA?
- Butterflies on DNA are pinning bets - traders use them when they expect DNA 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 DNA implied volatility affect this butterfly?
- DNA ATM IV is at 98.10% with IV rank near 21.67%, 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.