How are HUM 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 HUM butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 42.41%), the computed maximum profit is $1,600.16 per contract and the computed maximum loss is -$330.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a HUM butterfly?

The breakeven for the HUM butterfly priced on this page is roughly $373.30 and $406.72 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 HUM market-implied 1-standard-deviation expected move in the same options snapshot is approximately 12.16%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current HUM implied volatility affect this butterfly?

HUM ATM IV is at 42.41% with IV rank near 26.47%, 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.

HUM Butterfly Strategy

HUM (Humana Inc.), in the Healthcare sector, (Medical - Healthcare Plans industry), listed on NYSE.

Humana Inc., a prominent health and well-being enterprise, operates across the United States through its various subsidiary companies. Its operational structure is divided into three main segments: Retail, Group and Specialty, and Healthcare Services. The firm provides a wide array of medical and supplementary insurance plans directly to individual consumers. Furthermore, Humana collaborates with government entities; it holds a contract with the Centers for Medicare and Medicaid Services (CMS) to manage the Limited Income Newly Eligible Transition (LI NET) prescription drug program. The company also secures agreements with numerous states to deliver Medicaid, dual-eligible, and long-term care support benefits. For employer groups and individuals, Humana furnishes fully insured commercial medical and specialized health coverage, which encompasses dental, vision, and other ancillary health benefits.

HUM (Humana Inc.) trades in the Healthcare sector, specifically Medical - Healthcare Plans, with a market capitalization of approximately $46.67B, a trailing P/E of 36.56, a beta of 0.74 versus the broader market, a 52-week range of 163.11-428.88, average daily share volume of 1.6M, a public-listing history dating back to 1981, approximately 67K full-time employees. These structural characteristics shape how HUM stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.74 places HUM roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 36.56 is on the rich side, which tends to correlate with higher earnings-window IV expansion as the market debates whether forward growth supports the multiple. HUM pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on HUM?

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.

HUM snapshot

As of August 14, 2026, spot at $388.74, ATM IV 42.41%, IV rank 26.47%, expected move 12.16%. The butterfly on HUM 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 HUM specifically: HUM IV at 42.41% is on the cheap side of its 1-year range, which favors premium-buying structures like a HUM butterfly, with a market-implied 1-standard-deviation move of approximately 12.16% (roughly $47.26 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 HUM expiries trade a higher absolute premium for lower per-day decay. Position sizing on HUM should anchor to the underlying notional of $388.74 per share and to the trader's directional view on HUM stock.

HUM butterfly setup

The HUM 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 HUM at $388.74 on that close, the first option leg uses a $370.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed HUM 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 HUM shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$370.00	$29.40
Sell 2	Call	$390.00	$18.05
Buy 1	Call	$410.00	$10.00

HUM butterfly risk and reward

Net Premium / Debit: -$330.00
Max Profit (per contract): $1,600.16
Max Loss (per contract): -$330.00
Breakeven(s): $373.30, $406.72
Risk / Reward Ratio: 4.849

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.

HUM butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on HUM. 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	-100.0%	-$330.00
$85.96	-77.9%	-$330.00
$171.91	-55.8%	-$330.00
$257.86	-33.7%	-$330.00
$343.82	-11.6%	-$330.00
$429.77	+10.6%	-$330.00
$515.72	+32.7%	-$330.00
$601.67	+54.8%	-$330.00
$687.62	+76.9%	-$330.00
$773.57	+99.0%	-$330.00

When traders use butterfly on HUM

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

HUM thesis for this butterfly

The market-implied 1-standard-deviation range for HUM extends from approximately $341.48 on the downside to $436.00 on the upside. A HUM long call butterfly is a pinning play: it pays maximum at the middle strike if HUM settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current HUM IV rank near 26.47% 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 HUM at 42.41%. As a Healthcare name, HUM options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to HUM-specific events.

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

Frequently asked questions

What is a butterfly on HUM?: A butterfly on HUM is the butterfly strategy applied to HUM (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 HUM stock at $388.74 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed HUM chain strike and the premiums come straight from that session's bid/ask midpoint.
How are HUM 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 HUM butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 42.41%), the computed maximum profit is $1,600.16 per contract and the computed maximum loss is -$330.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a HUM butterfly?: The breakeven for the HUM butterfly priced on this page is roughly $373.30 and $406.72 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 HUM market-implied 1-standard-deviation expected move in the same options snapshot is approximately 12.16%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on HUM?: Butterflies on HUM are pinning bets - traders use them when they expect HUM 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 HUM implied volatility affect this butterfly?: HUM ATM IV is at 42.41% with IV rank near 26.47%, 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.