How are EMR 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 EMR butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 31.91%), the computed maximum profit is $424.21 per contract and the computed maximum loss is -$217.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a EMR butterfly?

The breakeven for the EMR butterfly priced on this page is roughly $128.18 and $137.83 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 EMR market-implied 1-standard-deviation expected move is approximately 9.15%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current EMR implied volatility affect this butterfly?

EMR ATM IV is at 31.91% with IV rank near 55.90%, 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.

EMR Butterfly Strategy

EMR (Emerson Electric Co.), in the Industrials sector, (Industrial - Machinery industry), listed on NYSE.

Emerson Electric Co., a technology and engineering company, provides various solutions for customers in industrial, commercial, and residential markets in the Americas, Asia, the Middle East, Africa, and Europe. The company operates through Automation Solutions, and Commercial & Residential Solutions segments. The Automation Solutions segment offers measurement and analytical instrumentation, industrial valves and equipment, and process control software and systems. It serves oil and gas, refining, chemicals, power generation, life sciences, food and beverage, automotive, pulp and paper, metals and mining, and municipal water supplies markets. The Commercial & Residential Solutions segment offers residential and commercial heating and air conditioning products, such as reciprocating and scroll compressors; system protector and flow control devices; standard, programmable, and Wi-Fi thermostats; monitoring equipment and electronic controls for gas and electric heating systems; gas valves for furnaces and water heaters; ignition systems for furnaces; sensors and thermistors for home appliances; and temperature sensors and controls. It also provides reciprocating, scroll, and screw compressors; precision flow controls; system diagnostics and controls; and environmental control systems.

EMR (Emerson Electric Co.) trades in the Industrials sector, specifically Industrial - Machinery, with a market capitalization of approximately $77.16B, a trailing P/E of 31.60, a beta of 1.26 versus the broader market, a 52-week range of 114.83-165.15, average daily share volume of 3.0M, a public-listing history dating back to 1972, approximately 73K full-time employees. These structural characteristics shape how EMR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.26 places EMR roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. EMR pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on EMR?

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 EMR snapshot

As of May 15, 2026, spot at $132.91, ATM IV 31.91%, IV rank 55.90%, expected move 9.15%. The butterfly on EMR 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 28-day expiry.

Why this butterfly structure on EMR specifically: EMR IV at 31.91% 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 9.15% (roughly $12.16 on the underlying). The 28-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated EMR expiries trade a higher absolute premium for lower per-day decay. Position sizing on EMR should anchor to the underlying notional of $132.91 per share and to the trader's directional view on EMR stock.

EMR butterfly setup

The EMR 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 EMR near $132.91, the first option leg uses a $126.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed EMR chain at a 28-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 EMR shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$126.00	$9.60
Sell 2	Call	$133.00	$5.10
Buy 1	Call	$140.00	$2.78

EMR butterfly risk and reward

Net Premium / Debit: -$217.50
Max Profit (per contract): $424.21
Max Loss (per contract): -$217.50
Breakeven(s): $128.18, $137.83
Risk / Reward Ratio: 1.950

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.

EMR butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on EMR. 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%	-$217.50
$29.40	-77.9%	-$217.50
$58.78	-55.8%	-$217.50
$88.17	-33.7%	-$217.50
$117.55	-11.6%	-$217.50
$146.94	+10.6%	-$217.50
$176.33	+32.7%	-$217.50
$205.71	+54.8%	-$217.50
$235.10	+76.9%	-$217.50
$264.48	+99.0%	-$217.50

When traders use butterfly on EMR

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

EMR thesis for this butterfly

The market-implied 1-standard-deviation range for EMR extends from approximately $120.75 on the downside to $145.07 on the upside. A EMR long call butterfly is a pinning play: it pays maximum at the middle strike if EMR settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current EMR IV rank near 55.90% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on EMR should anchor more to the directional view and the expected-move geometry. As a Industrials name, EMR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to EMR-specific events.

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

Frequently asked questions

What is a butterfly on EMR?: A butterfly on EMR is the butterfly strategy applied to EMR (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 EMR stock trading near $132.91, the strikes shown on this page are snapped to the nearest listed EMR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are EMR 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 EMR butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 31.91%), the computed maximum profit is $424.21 per contract and the computed maximum loss is -$217.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a EMR butterfly?: The breakeven for the EMR butterfly priced on this page is roughly $128.18 and $137.83 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 EMR market-implied 1-standard-deviation expected move is approximately 9.15%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on EMR?: Butterflies on EMR are pinning bets - traders use them when they expect EMR 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 EMR implied volatility affect this butterfly?: EMR ATM IV is at 31.91% with IV rank near 55.90%, 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.