How are HII 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 HII butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 34.20%), the computed maximum profit is $1,076.81 per contract and the computed maximum loss is -$815.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a HII butterfly?

The breakeven for the HII butterfly priced on this page is roughly $318.15 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 HII market-implied 1-standard-deviation expected move is approximately 9.80%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current HII implied volatility affect this butterfly?

HII ATM IV is at 34.20% with IV rank near 30.07%, 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.

HII Butterfly Strategy

HII (Huntington Ingalls Industries, Inc.), in the Industrials sector, (Aerospace & Defense industry), listed on NYSE.

Huntington Ingalls Industries, Inc. engages in designing, building, overhauling, and repairing military ships in the United States. It operates through three segments: Ingalls Shipbuilding, Newport News Shipbuilding, and Technical Solutions. The company is involved in the design and construction of non-nuclear ships comprising amphibious assault ships; expeditionary warfare ships; surface combatants; and national security cutters for the U.S. Navy and U.S. Coast Guard. It also provides nuclear-powered ships, such as aircraft carriers and submarines, as well as refueling and overhaul, and inactivation services of ships.

HII (Huntington Ingalls Industries, Inc.) trades in the Industrials sector, specifically Aerospace & Defense, with a market capitalization of approximately $13.17B, a trailing P/E of 21.71, a beta of 0.29 versus the broader market, a 52-week range of 215.05-460, average daily share volume of 520K, a public-listing history dating back to 2011, approximately 44K full-time employees. These structural characteristics shape how HII stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.29 indicates HII has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. HII pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on HII?

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 HII snapshot

As of May 15, 2026, spot at $326.16, ATM IV 34.20%, IV rank 30.07%, expected move 9.80%. The butterfly on HII 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 HII specifically: HII IV at 34.20% 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 9.80% (roughly $31.98 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 HII expiries trade a higher absolute premium for lower per-day decay. Position sizing on HII should anchor to the underlying notional of $326.16 per share and to the trader's directional view on HII stock.

HII butterfly setup

The HII 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 HII near $326.16, the first option leg uses a $310.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed HII 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 HII shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$310.00	$23.55
Sell 2	Call	$330.00	$11.90
Buy 1	Call	$340.00	$8.40

HII butterfly risk and reward

Net Premium / Debit: -$815.00
Max Profit (per contract): $1,076.81
Max Loss (per contract): -$815.00
Breakeven(s): $318.15
Risk / Reward Ratio: 1.321

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.

HII butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on HII. 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%	-$815.00
$72.12	-77.9%	-$815.00
$144.24	-55.8%	-$815.00
$216.35	-33.7%	-$815.00
$288.47	-11.6%	-$815.00
$360.58	+10.6%	+$185.00
$432.70	+32.7%	+$185.00
$504.81	+54.8%	+$185.00
$576.93	+76.9%	+$185.00
$649.04	+99.0%	+$185.00

When traders use butterfly on HII

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

HII thesis for this butterfly

The market-implied 1-standard-deviation range for HII extends from approximately $294.18 on the downside to $358.14 on the upside. A HII long call butterfly is a pinning play: it pays maximum at the middle strike if HII settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current HII IV rank near 30.07% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on HII should anchor more to the directional view and the expected-move geometry. As a Industrials name, HII options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to HII-specific events.

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

Frequently asked questions

What is a butterfly on HII?: A butterfly on HII is the butterfly strategy applied to HII (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 HII stock trading near $326.16, the strikes shown on this page are snapped to the nearest listed HII chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are HII 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 HII butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 34.20%), the computed maximum profit is $1,076.81 per contract and the computed maximum loss is -$815.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a HII butterfly?: The breakeven for the HII butterfly priced on this page is roughly $318.15 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 HII market-implied 1-standard-deviation expected move is approximately 9.80%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on HII?: Butterflies on HII are pinning bets - traders use them when they expect HII 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 HII implied volatility affect this butterfly?: HII ATM IV is at 34.20% with IV rank near 30.07%, 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.