INOD Butterfly Strategy
INOD (Innodata Inc.), in the Technology sector, (Information Technology Services industry), listed on NASDAQ.
Innodata Inc. operates as a global data engineering company in the United States, the United Kingdom, the Netherlands, Canada, and internationally. The company operates through three segments: Digital Data Solutions (DDS), Synodex, and Agility. The DDS segment offers AI-enabled software platforms and managed services to companies that require data for training AI and machine learning (ML) algorithms, and AI digital transformation solutions to help companies apply AI/ML for problems relating to analyzing and deriving insights from documents. This segment provides a range of data engineering support services, including data annotation, data transformation, data transformation, data curation, data hygiene, data consolidation, data compliance, and master data management. The Synodex segment offers an industry platform that transforms medical records into useable digital data with its proprietary data models or client data models. The Agility segment provides an industry platform that provides marketing communications and public relations professionals to target and distribute content to journalists and social media influencers; and to monitor and analyze global news channels, such as print, web, radio, and TV, as well as social media channels.
INOD (Innodata Inc.) trades in the Technology sector, specifically Information Technology Services, with a market capitalization of approximately $2.94B, a trailing P/E of 74.69, a beta of 2.40 versus the broader market, a 52-week range of 33.44-114.77, average daily share volume of 1.5M, a public-listing history dating back to 1993, approximately 7K full-time employees. These structural characteristics shape how INOD stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 2.40 indicates INOD has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. The trailing P/E of 74.69 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.
What is a butterfly on INOD?
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 INOD snapshot
As of May 15, 2026, spot at $96.38, ATM IV 84.44%, IV rank 29.74%, expected move 24.21%. The butterfly on INOD 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 28-day expiry.
Why this butterfly structure on INOD specifically: INOD IV at 84.44% is on the cheap side of its 1-year range, which favors premium-buying structures like a INOD butterfly, with a market-implied 1-standard-deviation move of approximately 24.21% (roughly $23.33 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 INOD expiries trade a higher absolute premium for lower per-day decay. Position sizing on INOD should anchor to the underlying notional of $96.38 per share and to the trader's directional view on INOD stock.
INOD butterfly setup
The INOD 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 INOD near $96.38, the first option leg uses a $92.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed INOD 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 INOD shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $92.00 | $10.95 |
| Sell 2 | Call | $96.00 | $8.90 |
| Buy 1 | Call | $101.00 | $7.15 |
INOD butterfly risk and reward
- Net Premium / Debit
- -$30.00
- Max Profit (per contract)
- $360.07
- Max Loss (per contract)
- -$130.00
- Breakeven(s)
- $92.30, $99.70
- Risk / Reward Ratio
- 2.770
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.
INOD butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on INOD. 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% | -$30.00 |
| $21.32 | -77.9% | -$30.00 |
| $42.63 | -55.8% | -$30.00 |
| $63.94 | -33.7% | -$30.00 |
| $85.25 | -11.6% | -$30.00 |
| $106.56 | +10.6% | -$130.00 |
| $127.86 | +32.7% | -$130.00 |
| $149.17 | +54.8% | -$130.00 |
| $170.48 | +76.9% | -$130.00 |
| $191.79 | +99.0% | -$130.00 |
When traders use butterfly on INOD
Butterflies on INOD are pinning bets - traders use them when they expect INOD 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.
INOD thesis for this butterfly
The market-implied 1-standard-deviation range for INOD extends from approximately $73.05 on the downside to $119.71 on the upside. A INOD long call butterfly is a pinning play: it pays maximum at the middle strike if INOD settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current INOD IV rank near 29.74% 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 INOD at 84.44%. As a Technology name, INOD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to INOD-specific events.
INOD 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. INOD positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move INOD alongside the broader basket even when INOD-specific fundamentals are unchanged. Always rebuild the position from current INOD chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on INOD?
- A butterfly on INOD is the butterfly strategy applied to INOD (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 INOD stock trading near $96.38, the strikes shown on this page are snapped to the nearest listed INOD chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are INOD 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 INOD butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 84.44%), the computed maximum profit is $360.07 per contract and the computed maximum loss is -$130.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a INOD butterfly?
- The breakeven for the INOD butterfly priced on this page is roughly $92.30 and $99.70 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 INOD market-implied 1-standard-deviation expected move is approximately 24.21%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on INOD?
- Butterflies on INOD are pinning bets - traders use them when they expect INOD 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 INOD implied volatility affect this butterfly?
- INOD ATM IV is at 84.44% with IV rank near 29.74%, 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.