How are ECPG 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 ECPG butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 39.70%), the computed maximum profit is $204.53 per contract and the computed maximum loss is -$265.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a ECPG butterfly?

The breakeven for the ECPG butterfly priced on this page is roughly $77.47 and $82.35 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 ECPG market-implied 1-standard-deviation expected move is approximately 11.38%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current ECPG implied volatility affect this butterfly?

ECPG ATM IV is at 39.70% with IV rank near 4.85%, 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.

ECPG Butterfly Strategy

ECPG (Encore Capital Group, Inc.), in the Financial Services sector, (Financial - Mortgages industry), listed on NASDAQ.

Encore Capital Group, Inc., a specialty finance company, provides debt recovery solutions and other related services for consumers across financial assets worldwide. The company purchases portfolios of defaulted consumer receivables at deep discounts to face value, as well as manages them by working with individuals as they repay their obligations and works toward financial recovery. It is also involved in the provision of early stage collection, business process outsourcing, and contingent collection services, as well as debt servicing and other portfolio management services to credit originator for non-performing loans. The company was incorporated in 1999 and is headquartered in San Diego, California.

ECPG (Encore Capital Group, Inc.) trades in the Financial Services sector, specifically Financial - Mortgages, with a market capitalization of approximately $1.69B, a trailing P/E of 5.79, a beta of 1.33 versus the broader market, a 52-week range of 35.67-92.64, average daily share volume of 336K, a public-listing history dating back to 1999, approximately 7K full-time employees. These structural characteristics shape how ECPG stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.33 indicates ECPG has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. The trailing P/E of 5.79 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price.

What is a butterfly on ECPG?

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 ECPG snapshot

As of May 15, 2026, spot at $80.91, ATM IV 39.70%, IV rank 4.85%, expected move 11.38%. The butterfly on ECPG 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 ECPG specifically: ECPG IV at 39.70% is on the cheap side of its 1-year range, which favors premium-buying structures like a ECPG butterfly, with a market-implied 1-standard-deviation move of approximately 11.38% (roughly $9.21 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 ECPG expiries trade a higher absolute premium for lower per-day decay. Position sizing on ECPG should anchor to the underlying notional of $80.91 per share and to the trader's directional view on ECPG stock.

ECPG butterfly setup

The ECPG 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 ECPG near $80.91, the first option leg uses a $77.50 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ECPG 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 ECPG shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$77.50	$5.95
Sell 2	Call	$80.00	$4.15
Buy 1	Call	$85.00	$2.50

ECPG butterfly risk and reward

Net Premium / Debit: -$15.00
Max Profit (per contract): $204.53
Max Loss (per contract): -$265.00
Breakeven(s): $77.47, $82.35
Risk / Reward Ratio: 0.772

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.

ECPG butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on ECPG. 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%	-$15.00
$17.90	-77.9%	-$15.00
$35.79	-55.8%	-$15.00
$53.68	-33.7%	-$15.00
$71.56	-11.6%	-$15.00
$89.45	+10.6%	-$265.00
$107.34	+32.7%	-$265.00
$125.23	+54.8%	-$265.00
$143.12	+76.9%	-$265.00
$161.01	+99.0%	-$265.00

When traders use butterfly on ECPG

Butterflies on ECPG are pinning bets - traders use them when they expect ECPG 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.

ECPG thesis for this butterfly

The market-implied 1-standard-deviation range for ECPG extends from approximately $71.70 on the downside to $90.12 on the upside. A ECPG long call butterfly is a pinning play: it pays maximum at the middle strike if ECPG settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current ECPG IV rank near 4.85% 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 ECPG at 39.70%. As a Financial Services name, ECPG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ECPG-specific events.

ECPG 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. ECPG positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ECPG alongside the broader basket even when ECPG-specific fundamentals are unchanged. Always rebuild the position from current ECPG chain quotes before placing a trade.

Frequently asked questions

What is a butterfly on ECPG?: A butterfly on ECPG is the butterfly strategy applied to ECPG (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 ECPG stock trading near $80.91, the strikes shown on this page are snapped to the nearest listed ECPG chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are ECPG 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 ECPG butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 39.70%), the computed maximum profit is $204.53 per contract and the computed maximum loss is -$265.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a ECPG butterfly?: The breakeven for the ECPG butterfly priced on this page is roughly $77.47 and $82.35 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 ECPG market-implied 1-standard-deviation expected move is approximately 11.38%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on ECPG?: Butterflies on ECPG are pinning bets - traders use them when they expect ECPG 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 ECPG implied volatility affect this butterfly?: ECPG ATM IV is at 39.70% with IV rank near 4.85%, 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.