FDUS Butterfly Strategy
FDUS (Fidus Investment Corporation), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.
Fidus Investment Corporation is a business development company. It specializing in leveraged buyouts, refinancings, change of ownership transactions, recapitalizations, strategic acquisitions, mezzanine, growth capital, business expansion, lower middle market investments, debt investments, subordinated and second lien loans, senior secured and unitranche debt, preferred equity, warrants, subordinated debt, senior subordinated notes, junior secured loans, and unitranche loans. It does not invest in turnarounds or distressed situations. The fund prefers to invest in aerospace and defense, business services, consumer products and services including retail, food, and beverage, healthcare products and services, industrial products and services, information technology services, niche manufacturing, transportation and logistics, and value-added distribution sectors. It seeks to invest in companies based in United States. The fund typically invests between $5 million and $15 million per transaction in companies with annual revenues between $10 million and $150 million and an annual EBITDA between $3 million and $20 million, but it can occasionally invest in larger or smaller companies.
FDUS (Fidus Investment Corporation) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $706.0M, a trailing P/E of 8.54, a beta of 0.74 versus the broader market, a 52-week range of 16.87-22.09, average daily share volume of 303K, a public-listing history dating back to 2011. These structural characteristics shape how FDUS stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.74 places FDUS roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 8.54 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. FDUS pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on FDUS?
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 FDUS snapshot
As of May 15, 2026, spot at $18.77, ATM IV 253.80%, IV rank 68.81%, expected move 5.68%. The butterfly on FDUS 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 FDUS specifically: FDUS IV at 253.80% 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 5.68% (roughly $1.07 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 FDUS expiries trade a higher absolute premium for lower per-day decay. Position sizing on FDUS should anchor to the underlying notional of $18.77 per share and to the trader's directional view on FDUS stock.
FDUS butterfly setup
The FDUS 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 FDUS near $18.77, the first option leg uses a $17.83 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FDUS 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 FDUS shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $17.83 | N/A |
| Sell 2 | Call | $18.77 | N/A |
| Buy 1 | Call | $19.71 | N/A |
FDUS 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.
FDUS butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on FDUS. 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 FDUS
Butterflies on FDUS are pinning bets - traders use them when they expect FDUS 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.
FDUS thesis for this butterfly
The market-implied 1-standard-deviation range for FDUS extends from approximately $17.70 on the downside to $19.84 on the upside. A FDUS long call butterfly is a pinning play: it pays maximum at the middle strike if FDUS settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current FDUS IV rank near 68.81% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on FDUS should anchor more to the directional view and the expected-move geometry. As a Financial Services name, FDUS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FDUS-specific events.
FDUS 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. FDUS positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FDUS alongside the broader basket even when FDUS-specific fundamentals are unchanged. Always rebuild the position from current FDUS chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on FDUS?
- A butterfly on FDUS is the butterfly strategy applied to FDUS (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 FDUS stock trading near $18.77, the strikes shown on this page are snapped to the nearest listed FDUS chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are FDUS 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 FDUS butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 253.80%), 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 FDUS butterfly?
- The breakeven for the FDUS 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 FDUS market-implied 1-standard-deviation expected move is approximately 5.68%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on FDUS?
- Butterflies on FDUS are pinning bets - traders use them when they expect FDUS 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 FDUS implied volatility affect this butterfly?
- FDUS ATM IV is at 253.80% with IV rank near 68.81%, 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.