HITI Butterfly Strategy
HITI (High Tide Inc.), in the Healthcare sector, (Medical - Pharmaceuticals industry), listed on NASDAQ.
High Tide Inc. engages in the cannabis retail business in Canada, Europe, the United States, and internationally. The company designs, manufactures, and distributes smoking accessories and cannabis lifestyle products. It is also involved in the wholesale and retailing of cannabis products, as well as operates and franchises licensed retail cannabis stores. In addition, the company provides data analytics services, as well as operates Grasscity.com and CBDcity.com platforms. As of August 4, 2022, it operated 139 retail locations in Ontario, Alberta, British Columbia, Manitoba, and Saskatchewan. The company was formerly known as High Tide Ventures Inc. and changed its name to High Tide Inc. in October 2018.
HITI (High Tide Inc.) trades in the Healthcare sector, specifically Medical - Pharmaceuticals, with a market capitalization of approximately $211.8M, a beta of 1.07 versus the broader market, a 52-week range of 2.1-4.055, average daily share volume of 464K, a public-listing history dating back to 2021, approximately 2K full-time employees. These structural characteristics shape how HITI stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.07 places HITI roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a butterfly on HITI?
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 HITI snapshot
As of May 15, 2026, spot at $2.42, ATM IV 69.60%, IV rank 17.20%, expected move 19.95%. The butterfly on HITI 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 HITI specifically: HITI IV at 69.60% is on the cheap side of its 1-year range, which favors premium-buying structures like a HITI butterfly, with a market-implied 1-standard-deviation move of approximately 19.95% (roughly $0.48 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 HITI expiries trade a higher absolute premium for lower per-day decay. Position sizing on HITI should anchor to the underlying notional of $2.42 per share and to the trader's directional view on HITI stock.
HITI butterfly setup
The HITI 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 HITI near $2.42, the first option leg uses a $2.30 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed HITI 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 HITI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $2.30 | N/A |
| Sell 2 | Call | $2.42 | N/A |
| Buy 1 | Call | $2.54 | N/A |
HITI 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.
HITI butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on HITI. 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 HITI
Butterflies on HITI are pinning bets - traders use them when they expect HITI 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.
HITI thesis for this butterfly
The market-implied 1-standard-deviation range for HITI extends from approximately $1.94 on the downside to $2.90 on the upside. A HITI long call butterfly is a pinning play: it pays maximum at the middle strike if HITI settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current HITI IV rank near 17.20% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on HITI at 69.60%. As a Healthcare name, HITI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to HITI-specific events.
HITI 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. HITI positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move HITI alongside the broader basket even when HITI-specific fundamentals are unchanged. Always rebuild the position from current HITI chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on HITI?
- A butterfly on HITI is the butterfly strategy applied to HITI (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 HITI stock trading near $2.42, the strikes shown on this page are snapped to the nearest listed HITI chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are HITI 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 HITI butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 69.60%), 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 HITI butterfly?
- The breakeven for the HITI 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 HITI market-implied 1-standard-deviation expected move is approximately 19.95%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on HITI?
- Butterflies on HITI are pinning bets - traders use them when they expect HITI 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 HITI implied volatility affect this butterfly?
- HITI ATM IV is at 69.60% with IV rank near 17.20%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.