HNRG Butterfly Strategy
HNRG (Hallador Energy Company), in the Energy sector, (Coal industry), listed on NASDAQ.
Hallador Energy Company focuses on extracting steam coal from its operations within Indiana, primarily supplying this fuel to the electric power generation sector. The company's mining assets include the subterranean Oaktown Mine 1 and Oaktown Mine 2, both situated in Oaktown, Indiana, alongside the Ace in the Hole mine, located near Clay City, Indiana. In addition to its coal activities, Hallador Energy also conducts natural gas exploration throughout Indiana. The firm was established in 1949 and its corporate headquarters are located in Terre Haute, Indiana.
HNRG (Hallador Energy Company) trades in the Energy sector, specifically Coal, with a market capitalization of approximately $743.2M, a beta of 0.30 versus the broader market, a 52-week range of 13.65-24.7, average daily share volume of 877K, a public-listing history dating back to 1994, approximately 633 full-time employees. These structural characteristics shape how HNRG stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.30 indicates HNRG has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. HNRG pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on HNRG?
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.
HNRG snapshot
As of August 14, 2026, spot at $16.07, ATM IV 62.00%, IV rank 13.91%, expected move 17.77%. The butterfly on HNRG 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 7-day expiry.
Why this butterfly structure on HNRG specifically: HNRG IV at 62.00% is on the cheap side of its 1-year range, which favors premium-buying structures like a HNRG butterfly, with a market-implied 1-standard-deviation move of approximately 17.77% (roughly $2.86 on the underlying). The 7-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated HNRG expiries trade a higher absolute premium for lower per-day decay. Position sizing on HNRG should anchor to the underlying notional of $16.07 per share and to the trader's directional view on HNRG stock.
HNRG butterfly setup
The HNRG 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 HNRG at $16.07 on that close, the first option leg uses a $15.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed HNRG chain at a 7-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 HNRG shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $15.00 | $1.23 |
| Sell 2 | Call | $16.00 | $0.53 |
| Buy 1 | Call | $17.00 | $0.23 |
HNRG butterfly risk and reward
- Net Premium / Debit
- -$40.00
- Max Profit (per contract)
- $59.43
- Max Loss (per contract)
- -$40.00
- Breakeven(s)
- $15.40, $16.60
- Risk / Reward Ratio
- 1.486
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.
HNRG butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on HNRG. 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% | -$40.00 |
| $3.56 | -77.8% | -$40.00 |
| $7.11 | -55.7% | -$40.00 |
| $10.67 | -33.6% | -$40.00 |
| $14.22 | -11.5% | -$40.00 |
| $17.77 | +10.6% | -$40.00 |
| $21.32 | +32.7% | -$40.00 |
| $24.87 | +54.8% | -$40.00 |
| $28.43 | +76.9% | -$40.00 |
| $31.98 | +99.0% | -$40.00 |
When traders use butterfly on HNRG
Butterflies on HNRG are pinning bets - traders use them when they expect HNRG 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.
HNRG thesis for this butterfly
The market-implied 1-standard-deviation range for HNRG extends from approximately $13.21 on the downside to $18.93 on the upside. A HNRG long call butterfly is a pinning play: it pays maximum at the middle strike if HNRG settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current HNRG IV rank near 13.91% 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 HNRG at 62.00%. As a Energy name, HNRG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to HNRG-specific events.
HNRG 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. HNRG positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move HNRG alongside the broader basket even when HNRG-specific fundamentals are unchanged. Always rebuild the position from current HNRG chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on HNRG?
- A butterfly on HNRG is the butterfly strategy applied to HNRG (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 HNRG stock at $16.07 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed HNRG chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are HNRG 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 HNRG butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 62.00%), the computed maximum profit is $59.43 per contract and the computed maximum loss is -$40.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a HNRG butterfly?
- The breakeven for the HNRG butterfly priced on this page is roughly $15.40 and $16.60 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 HNRG market-implied 1-standard-deviation expected move in the same options snapshot is approximately 17.77%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on HNRG?
- Butterflies on HNRG are pinning bets - traders use them when they expect HNRG 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 HNRG implied volatility affect this butterfly?
- HNRG ATM IV is at 62.00% with IV rank near 13.91%, 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.