IEX Butterfly Strategy
IEX (IDEX Corporation), in the Industrials sector, (Industrial - Machinery industry), listed on NYSE.
IDEX Corporation, together with its subsidiaries, provides applied solutions worldwide. The company operates through three segments: Fluid & Metering Technologies (FMT), Health & Science Technologies (HST), and Fire & Safety/Diversified Products (FSDP). The FMT segment designs, produces, and distributes positive displacement pumps, small volume provers, flow meters, injectors, and other fluid-handling pump modules and systems, as well as offers flow monitoring and other services for the food, chemical, general industrial, water and wastewater, agricultural, and energy industries. The HST segment designs, produces, and distributes precision fluidics, rotary lobe pumps, centrifugal and positive displacement pumps, roll compaction and drying systems, pneumatic components and sealing solutions, high performance molded and extruded sealing components, custom mechanical and shaft seals, engineered hygienic mixers and valves, biocompatible medical devices and implantables, air compressors and blowers, optical components and coatings, laboratory and commercial equipment, precision photonic solutions, and precision gear and peristaltic pump technologies. This segment serves food and beverage, pharmaceutical and biopharmaceutical, cosmetics, marine, chemical, wastewater and water treatment, life sciences, research, and defense markets. The FSDP segment designs, produces, and distributes firefighting pumps, valves and controls, rescue tools, lifting bags, and other components and systems for the fire and rescue industry; engineered stainless steel banding and clamping devices for various industrial and commercial applications; and precision equipment for dispensing, metering, and mixing colorants and paints used in retail and commercial businesses.
IEX (IDEX Corporation) trades in the Industrials sector, specifically Industrial - Machinery, with a market capitalization of approximately $15.71B, a trailing P/E of 31.06, a beta of 1.01 versus the broader market, a 52-week range of 157.25-223.85, average daily share volume of 784K, a public-listing history dating back to 1989, approximately 9K full-time employees. These structural characteristics shape how IEX stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.01 places IEX roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. IEX pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on IEX?
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 IEX snapshot
As of May 15, 2026, spot at $208.18, ATM IV 25.70%, IV rank 4.11%, expected move 7.37%. The butterfly on IEX 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 IEX specifically: IEX IV at 25.70% is on the cheap side of its 1-year range, which favors premium-buying structures like a IEX butterfly, with a market-implied 1-standard-deviation move of approximately 7.37% (roughly $15.34 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 IEX expiries trade a higher absolute premium for lower per-day decay. Position sizing on IEX should anchor to the underlying notional of $208.18 per share and to the trader's directional view on IEX stock.
IEX butterfly setup
The IEX 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 IEX near $208.18, the first option leg uses a $200.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed IEX 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 IEX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $200.00 | $12.30 |
| Sell 2 | Call | $210.00 | $6.15 |
| Buy 1 | Call | $220.00 | $2.58 |
IEX butterfly risk and reward
- Net Premium / Debit
- -$257.50
- Max Profit (per contract)
- $665.61
- Max Loss (per contract)
- -$257.50
- Breakeven(s)
- $202.58, $217.43
- Risk / Reward Ratio
- 2.585
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.
IEX butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on IEX. 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% | -$257.50 |
| $46.04 | -77.9% | -$257.50 |
| $92.07 | -55.8% | -$257.50 |
| $138.10 | -33.7% | -$257.50 |
| $184.12 | -11.6% | -$257.50 |
| $230.15 | +10.6% | -$257.50 |
| $276.18 | +32.7% | -$257.50 |
| $322.21 | +54.8% | -$257.50 |
| $368.24 | +76.9% | -$257.50 |
| $414.27 | +99.0% | -$257.50 |
When traders use butterfly on IEX
Butterflies on IEX are pinning bets - traders use them when they expect IEX 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.
IEX thesis for this butterfly
The market-implied 1-standard-deviation range for IEX extends from approximately $192.84 on the downside to $223.52 on the upside. A IEX long call butterfly is a pinning play: it pays maximum at the middle strike if IEX settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current IEX IV rank near 4.11% 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 IEX at 25.70%. As a Industrials name, IEX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to IEX-specific events.
IEX 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. IEX positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move IEX alongside the broader basket even when IEX-specific fundamentals are unchanged. Always rebuild the position from current IEX chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on IEX?
- A butterfly on IEX is the butterfly strategy applied to IEX (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 IEX stock trading near $208.18, the strikes shown on this page are snapped to the nearest listed IEX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are IEX 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 IEX butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 25.70%), the computed maximum profit is $665.61 per contract and the computed maximum loss is -$257.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a IEX butterfly?
- The breakeven for the IEX butterfly priced on this page is roughly $202.58 and $217.43 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 IEX market-implied 1-standard-deviation expected move is approximately 7.37%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on IEX?
- Butterflies on IEX are pinning bets - traders use them when they expect IEX 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 IEX implied volatility affect this butterfly?
- IEX ATM IV is at 25.70% with IV rank near 4.11%, 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.