FSLY Butterfly Strategy
FSLY (Fastly, Inc.), in the Technology sector, (Software - Application industry), listed on NASDAQ.
Fastly, Inc. operates an edge cloud platform for processing, serving, and securing its customer's applications in the United States, the Asia Pacific, Europe, and internationally. The edge cloud is a category of Infrastructure as a Service that enables developers to build, secure, and deliver digital experiences at the edge of the internet. It is a programmable platform designed for web and application delivery. The company offers Compute@Edge; developer hub that includes solution library patterns and recipes, API and language references, change logs, and Fastly Fiddle solutions; device detection and geolocation, edge dictionaries, edge access control lists, and edge authentication services; full site delivery services, such as dynamic site acceleration, origin shield, instant purge, surrogate keys, real-time logging and stats, cloud optimizer, programmatic control, edge databases, content compression, reliability, and modern protocols and performance services; and streaming solutions and services, including live streaming, media shield, and origin connect. It also provides edge security solutions, such as DDoS protection and cloud, edge web application firewall (WAF), transport layer security (TLS), platform TLS, and compliance services; unified web application and API protection solutions that includes runtime self-application protection, advanced rate limiting, API and ATO protection, account takeover protection, bot protection, and next generation WAF. In addition, the company offers edge applications, such as load balancers and image optimizers; video on demand; and managed edge delivery services.
FSLY (Fastly, Inc.) trades in the Technology sector, specifically Software - Application, with a market capitalization of approximately $2.87B, a beta of 0.49 versus the broader market, a 52-week range of 6.29-34.82, average daily share volume of 13.8M, a public-listing history dating back to 2019, approximately 1K full-time employees. These structural characteristics shape how FSLY stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.49 indicates FSLY has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.
What is a butterfly on FSLY?
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 FSLY snapshot
As of May 15, 2026, spot at $17.13, ATM IV 75.28%, IV rank 34.17%, expected move 21.58%. The butterfly on FSLY 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 FSLY specifically: FSLY IV at 75.28% 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 21.58% (roughly $3.70 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 FSLY expiries trade a higher absolute premium for lower per-day decay. Position sizing on FSLY should anchor to the underlying notional of $17.13 per share and to the trader's directional view on FSLY stock.
FSLY butterfly setup
The FSLY 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 FSLY near $17.13, the first option leg uses a $16.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FSLY 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 FSLY shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $16.00 | $2.20 |
| Sell 2 | Call | $17.00 | $1.48 |
| Buy 1 | Call | $18.00 | $1.05 |
FSLY butterfly risk and reward
- Net Premium / Debit
- -$30.00
- Max Profit (per contract)
- $65.11
- Max Loss (per contract)
- -$30.00
- Breakeven(s)
- $16.30, $17.70
- Risk / Reward Ratio
- 2.170
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.
FSLY butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on FSLY. 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% | -$30.00 |
| $3.80 | -77.8% | -$30.00 |
| $7.58 | -55.7% | -$30.00 |
| $11.37 | -33.6% | -$30.00 |
| $15.16 | -11.5% | -$30.00 |
| $18.94 | +10.6% | -$30.00 |
| $22.73 | +32.7% | -$30.00 |
| $26.52 | +54.8% | -$30.00 |
| $30.30 | +76.9% | -$30.00 |
| $34.09 | +99.0% | -$30.00 |
When traders use butterfly on FSLY
Butterflies on FSLY are pinning bets - traders use them when they expect FSLY 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.
FSLY thesis for this butterfly
The market-implied 1-standard-deviation range for FSLY extends from approximately $13.43 on the downside to $20.83 on the upside. A FSLY long call butterfly is a pinning play: it pays maximum at the middle strike if FSLY settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current FSLY IV rank near 34.17% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on FSLY should anchor more to the directional view and the expected-move geometry. As a Technology name, FSLY options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FSLY-specific events.
FSLY 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. FSLY positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FSLY alongside the broader basket even when FSLY-specific fundamentals are unchanged. Always rebuild the position from current FSLY chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on FSLY?
- A butterfly on FSLY is the butterfly strategy applied to FSLY (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 FSLY stock trading near $17.13, the strikes shown on this page are snapped to the nearest listed FSLY chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are FSLY 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 FSLY butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 75.28%), the computed maximum profit is $65.11 per contract and the computed maximum loss is -$30.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a FSLY butterfly?
- The breakeven for the FSLY butterfly priced on this page is roughly $16.30 and $17.70 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 FSLY market-implied 1-standard-deviation expected move is approximately 21.58%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on FSLY?
- Butterflies on FSLY are pinning bets - traders use them when they expect FSLY 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 FSLY implied volatility affect this butterfly?
- FSLY ATM IV is at 75.28% with IV rank near 34.17%, 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.