How are FERG 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 FERG butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 33.40%), the computed maximum profit is $955.64 per contract and the computed maximum loss is -$1,015.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a FERG butterfly?

The breakeven for the FERG butterfly priced on this page is roughly $230.15 and $250.31 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 FERG market-implied 1-standard-deviation expected move is approximately 9.58%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current FERG implied volatility affect this butterfly?

FERG ATM IV is at 33.40% with IV rank near 37.45%, 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.

FERG Butterfly Strategy

FERG (Ferguson plc), in the Industrials sector, (Industrial - Distribution industry), listed on NYSE.

Ferguson plc operates as a major supplier of plumbing, heating, and related industrial products throughout the United States and Canada. The company serves a diverse client base, providing essential solutions for residential, commercial, civil/infrastructure, and industrial projects. Its extensive product range encompasses core plumbing and heating supplies, such as pipes, valves, fittings, water heaters, and a variety of kitchen and bathroom fixtures and appliances. Beyond these essentials, Ferguson also provides heating, ventilation, air conditioning, and refrigeration (HVAC/R) equipment, as well as fire sprinkler systems and associated components. The company's offerings further extend to specialized water management products like water meters, irrigation and drainage systems, geosynthetics, and stormwater control solutions. Industrial customers can access a broad selection of flanges, general industrial maintenance, repair, and operations (MRO) products, high-density polyethylene (HDPE) materials, custom fabrication products, water and wastewater treatment solutions, and comprehensive pipe, valve, and fitting (PVF) systems.

FERG (Ferguson plc) trades in the Industrials sector, specifically Industrial - Distribution, with a market capitalization of approximately $46.28B, a trailing P/E of 22.40, a beta of 1.13 versus the broader market, a 52-week range of 207.64-271.64, average daily share volume of 1.4M, a public-listing history dating back to 2010, approximately 35K full-time employees. These structural characteristics shape how FERG stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.13 places FERG roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. FERG pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on FERG?

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 FERG snapshot

As of June 29, 2026, spot at $236.72, ATM IV 33.40%, IV rank 37.45%, expected move 9.58%. The butterfly on FERG 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 18-day expiry.

Why this butterfly structure on FERG specifically: FERG IV at 33.40% 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 9.58% (roughly $22.67 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated FERG expiries trade a higher absolute premium for lower per-day decay. Position sizing on FERG should anchor to the underlying notional of $236.72 per share and to the trader's directional view on FERG stock.

FERG butterfly setup

The FERG 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 FERG near $236.72, the first option leg uses a $220.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FERG chain at a 18-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 FERG shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$220.00	$19.45
Sell 2	Call	$240.00	$5.95
Buy 1	Call	$250.00	$2.60

FERG butterfly risk and reward

Net Premium / Debit: -$1,015.00
Max Profit (per contract): $955.64
Max Loss (per contract): -$1,015.00
Breakeven(s): $230.15, $250.31
Risk / Reward Ratio: 0.942

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.

FERG butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on FERG. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$1,015.00
$52.35	-77.9%	-$1,015.00
$104.69	-55.8%	-$1,015.00
$157.03	-33.7%	-$1,015.00
$209.37	-11.6%	-$1,015.00
$261.70	+10.6%	-$15.00
$314.04	+32.7%	-$15.00
$366.38	+54.8%	-$15.00
$418.72	+76.9%	-$15.00
$471.06	+99.0%	-$15.00

When traders use butterfly on FERG

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

FERG thesis for this butterfly

The market-implied 1-standard-deviation range for FERG extends from approximately $214.05 on the downside to $259.39 on the upside. A FERG long call butterfly is a pinning play: it pays maximum at the middle strike if FERG settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current FERG IV rank near 37.45% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on FERG should anchor more to the directional view and the expected-move geometry. As a Industrials name, FERG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FERG-specific events.

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

Frequently asked questions

What is a butterfly on FERG?: A butterfly on FERG is the butterfly strategy applied to FERG (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 FERG stock trading near $236.72, the strikes shown on this page are snapped to the nearest listed FERG chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are FERG 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 FERG butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 33.40%), the computed maximum profit is $955.64 per contract and the computed maximum loss is -$1,015.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a FERG butterfly?: The breakeven for the FERG butterfly priced on this page is roughly $230.15 and $250.31 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 FERG market-implied 1-standard-deviation expected move is approximately 9.58%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on FERG?: Butterflies on FERG are pinning bets - traders use them when they expect FERG 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 FERG implied volatility affect this butterfly?: FERG ATM IV is at 33.40% with IV rank near 37.45%, 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.