How are GME 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 GME butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 42.33%), the computed maximum profit is $90.38 per contract and the computed maximum loss is -$0.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a GME butterfly?

The breakeven for the GME butterfly priced on this page is roughly $17.47 and $19.52 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The GME market-implied 1-standard-deviation expected move in the same options snapshot is approximately 12.14%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current GME implied volatility affect this butterfly?

GME ATM IV is at 42.33% with IV rank near 35.04%, 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.

GME Butterfly Strategy

GME (GameStop Corp.), in the Consumer Cyclical sector, (Specialty Retail industry), listed on NYSE.

GameStop Corp. operates as a prominent specialty retailer, providing a diverse array of gaming and entertainment products to customers across the United States, Canada, Australia, and Europe, both through its online platforms and physical store locations. The company's merchandise includes new and pre-owned video game consoles, a wide selection of accessories such as controllers, gaming headsets, virtual reality equipment, and memory cards, as well as new and used gaming software. GameStop also offers digital gaming content, encompassing in-game currency, downloadable content (DLC), and full digital game downloads. Beyond its core gaming offerings, GameStop diversifies its inventory with licensed pop culture merchandise. These collectibles are primarily sourced from popular gaming franchises, television shows, movies, and broader pop culture themes. As of January 29, 2022, GameStop's retail network comprised 4,573 stores and e-commerce sites operating under its main brands: GameStop, EB Games, and Micromania.

GME (GameStop Corp.) trades in the Consumer Cyclical sector, specifically Specialty Retail, with a market capitalization of approximately $8.32B, a trailing P/E of 10.89, a beta of 1.76 versus the broader market, a 52-week range of 18.43-28.1, average daily share volume of 6.9M, a public-listing history dating back to 2002, approximately 4K full-time employees. These structural characteristics shape how GME stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.76 indicates GME 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 10.89 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. GME pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on GME?

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.

GME snapshot

As of August 14, 2026, spot at $18.68, ATM IV 42.33%, IV rank 35.04%, expected move 12.14%. The butterfly on GME below is built from the August 14, 2026 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 GME specifically: GME IV at 42.33% 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 12.14% (roughly $2.27 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 GME expiries trade a higher absolute premium for lower per-day decay. Position sizing on GME should anchor to the underlying notional of $18.68 per share and to the trader's directional view on GME stock.

GME butterfly setup

The GME butterfly below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With GME at $18.68 on that close, the first option leg uses a $17.50 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed GME 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 GME shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$17.50	$1.42
Sell 2	Call	$18.50	$1.03
Buy 1	Call	$19.50	$0.65

GME butterfly risk and reward

Net Premium / Debit: -$0.50
Max Profit (per contract): $90.38
Max Loss (per contract): -$0.50
Breakeven(s): $17.47, $19.52
Risk / Reward Ratio: 180.769

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.

GME butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on GME. 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	-99.9%	-$0.50
$4.14	-77.8%	-$0.50
$8.27	-55.7%	-$0.50
$12.40	-33.6%	-$0.50
$16.53	-11.5%	-$0.50
$20.66	+10.6%	-$0.50
$24.78	+32.7%	-$0.50
$28.91	+54.8%	-$0.50
$33.04	+76.9%	-$0.50
$37.17	+99.0%	-$0.50

When traders use butterfly on GME

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

GME thesis for this butterfly

The market-implied 1-standard-deviation range for GME extends from approximately $16.41 on the downside to $20.95 on the upside. A GME long call butterfly is a pinning play: it pays maximum at the middle strike if GME settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current GME IV rank near 35.04% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on GME should anchor more to the directional view and the expected-move geometry. As a Consumer Cyclical name, GME options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to GME-specific events.

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

Frequently asked questions

What is a butterfly on GME?: A butterfly on GME is the butterfly strategy applied to GME (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 GME stock at $18.68 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed GME chain strike and the premiums come straight from that session's bid/ask midpoint.
How are GME 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 GME butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 42.33%), the computed maximum profit is $90.38 per contract and the computed maximum loss is -$0.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a GME butterfly?: The breakeven for the GME butterfly priced on this page is roughly $17.47 and $19.52 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The GME market-implied 1-standard-deviation expected move in the same options snapshot is approximately 12.14%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on GME?: Butterflies on GME are pinning bets - traders use them when they expect GME 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 GME implied volatility affect this butterfly?: GME ATM IV is at 42.33% with IV rank near 35.04%, 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.