IRMD Butterfly Strategy
IRMD (IRadimed Corporation), in the Healthcare sector, (Medical - Devices industry), listed on NASDAQ.
IRADIMED CORPORATION specializes in the engineering, production, and distribution of medical devices specifically designed for compatibility with magnetic resonance imaging (MRI) environments. The company supplies these specialized products, alongside their related accessories and support services, to both U.S. and international markets. Key offerings include the MRidium MRI-compatible intravenous (IV) infusion pump system, which comes with disposable tubing sets, and an MRI-compatible patient vital signs monitoring system. Furthermore, IRADIMED provides a range of complementary items such as non-magnetic IV poles, wireless remote displays/controls, side car pump modules, dose error reduction systems, and SpO2 monitoring solutions with sensors. Their clientele primarily consists of hospitals, acute care facilities, and outpatient imaging centers. Sales are conducted via direct field representatives, regional sales directors, clinical support specialists, and independent distributors.
IRMD (IRadimed Corporation) trades in the Healthcare sector, specifically Medical - Devices, with a market capitalization of approximately $1.11B, a trailing P/E of 48.21, a beta of 0.91 versus the broader market, a 52-week range of 67.842-107.9, average daily share volume of 134K, a public-listing history dating back to 2014, approximately 166 full-time employees. These structural characteristics shape how IRMD stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.91 places IRMD roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 48.21 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. IRMD pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on IRMD?
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.
IRMD snapshot
As of August 14, 2026, spot at $86.41, ATM IV 35.50%, IV rank 3.63%, expected move 10.18%. The butterfly on IRMD 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 63-day expiry.
Why this butterfly structure on IRMD specifically: IRMD IV at 35.50% is on the cheap side of its 1-year range, which favors premium-buying structures like a IRMD butterfly, with a market-implied 1-standard-deviation move of approximately 10.18% (roughly $8.79 on the underlying). The 63-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated IRMD expiries trade a higher absolute premium for lower per-day decay. Position sizing on IRMD should anchor to the underlying notional of $86.41 per share and to the trader's directional view on IRMD stock.
IRMD butterfly setup
The IRMD 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 IRMD at $86.41 on that close, the first option leg uses a $80.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed IRMD chain at a 63-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 IRMD shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $80.00 | $9.00 |
| Sell 2 | Call | $85.00 | $5.75 |
| Buy 1 | Call | $90.00 | $3.85 |
IRMD butterfly risk and reward
- Net Premium / Debit
- -$135.00
- Max Profit (per contract)
- $353.76
- Max Loss (per contract)
- -$135.00
- Breakeven(s)
- $81.35, $88.65
- Risk / Reward Ratio
- 2.620
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.
IRMD butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on IRMD. 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% | -$135.00 |
| $19.11 | -77.9% | -$135.00 |
| $38.22 | -55.8% | -$135.00 |
| $57.32 | -33.7% | -$135.00 |
| $76.43 | -11.6% | -$135.00 |
| $95.53 | +10.6% | -$135.00 |
| $114.64 | +32.7% | -$135.00 |
| $133.74 | +54.8% | -$135.00 |
| $152.85 | +76.9% | -$135.00 |
| $171.95 | +99.0% | -$135.00 |
When traders use butterfly on IRMD
Butterflies on IRMD are pinning bets - traders use them when they expect IRMD 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.
IRMD thesis for this butterfly
The market-implied 1-standard-deviation range for IRMD extends from approximately $77.62 on the downside to $95.20 on the upside. A IRMD long call butterfly is a pinning play: it pays maximum at the middle strike if IRMD settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current IRMD IV rank near 3.63% 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 IRMD at 35.50%. As a Healthcare name, IRMD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to IRMD-specific events.
IRMD 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. IRMD positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move IRMD alongside the broader basket even when IRMD-specific fundamentals are unchanged. Always rebuild the position from current IRMD chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on IRMD?
- A butterfly on IRMD is the butterfly strategy applied to IRMD (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 IRMD stock at $86.41 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed IRMD chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are IRMD 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 IRMD butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 35.50%), the computed maximum profit is $353.76 per contract and the computed maximum loss is -$135.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a IRMD butterfly?
- The breakeven for the IRMD butterfly priced on this page is roughly $81.35 and $88.65 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 IRMD market-implied 1-standard-deviation expected move in the same options snapshot is approximately 10.18%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on IRMD?
- Butterflies on IRMD are pinning bets - traders use them when they expect IRMD 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 IRMD implied volatility affect this butterfly?
- IRMD ATM IV is at 35.50% with IV rank near 3.63%, 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.