How are IT 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 IT butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 47.80%), the computed maximum profit is $493.48 per contract and the computed maximum loss is -$470.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a IT butterfly?

The breakeven for the IT butterfly priced on this page is roughly $129.70 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 IT market-implied 1-standard-deviation expected move is approximately 13.70%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current IT implied volatility affect this butterfly?

IT ATM IV is at 47.80% with IV rank near 35.09%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.

IT Butterfly Strategy

IT (Gartner, Inc.), in the Industrials sector, (Consulting Services industry), listed on NYSE.

Gartner, Inc. functions as a premier research and advisory enterprise, extending its reach across the United States, Canada, Europe, the Middle East, Africa, and various international markets. Its operations are structured into three main divisions: Research, Conferences, and Consulting. The Research division primarily offers a subscription service, enabling on-demand access to extensive published studies, data, industry benchmarks, and direct consultations with its expert network. The Conferences segment provides a platform for business professionals to acquire new knowledge, share insights, and foster connections. Lastly, the Consulting segment furnishes clients with market research, bespoke analyses, and direct, on-site support services. This segment specifically addresses critical IT challenges, offering practical strategies for areas such as optimizing IT expenditures, managing digital transformation, and enhancing IT sourcing processes.

IT (Gartner, Inc.) trades in the Industrials sector, specifically Consulting Services, with a market capitalization of approximately $9.04B, a trailing P/E of 12.72, a beta of 0.93 versus the broader market, a 52-week range of 124.25-409.76, average daily share volume of 1.6M, a public-listing history dating back to 1993, approximately 21K full-time employees. These structural characteristics shape how IT stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.93 places IT roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.

What is a butterfly on IT?

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 IT snapshot

As of June 29, 2026, spot at $133.35, ATM IV 47.80%, IV rank 35.09%, expected move 13.70%. The butterfly on IT 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 18-day expiry.

Why this butterfly structure on IT specifically: IT IV at 47.80% is mid-range versus its 1-year history, so strategy selection should anchor more to the directional thesis than to the IV regime, with a market-implied 1-standard-deviation move of approximately 13.70% (roughly $18.27 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated IT expiries trade a higher absolute premium for lower per-day decay. Position sizing on IT should anchor to the underlying notional of $133.35 per share and to the trader's directional view on IT stock.

IT butterfly setup

The IT 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 IT near $133.35, the first option leg uses a $125.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed IT chain at a 18-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 IT shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$125.00	$11.65
Sell 2	Call	$135.00	$5.20
Buy 1	Call	$140.00	$3.45

IT butterfly risk and reward

Net Premium / Debit: -$470.00
Max Profit (per contract): $493.48
Max Loss (per contract): -$470.00
Breakeven(s): $129.70
Risk / Reward Ratio: 1.050

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.

IT butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on IT. 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%	-$470.00
$29.49	-77.9%	-$470.00
$58.98	-55.8%	-$470.00
$88.46	-33.7%	-$470.00
$117.94	-11.6%	-$470.00
$147.43	+10.6%	+$30.00
$176.91	+32.7%	+$30.00
$206.39	+54.8%	+$30.00
$235.88	+76.9%	+$30.00
$265.36	+99.0%	+$30.00

When traders use butterfly on IT

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

IT thesis for this butterfly

The market-implied 1-standard-deviation range for IT extends from approximately $115.08 on the downside to $151.62 on the upside. A IT long call butterfly is a pinning play: it pays maximum at the middle strike if IT settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current IT IV rank near 35.09% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on IT should anchor more to the directional view and the expected-move geometry. As a Industrials name, IT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to IT-specific events.

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

Frequently asked questions

What is a butterfly on IT?: A butterfly on IT is the butterfly strategy applied to IT (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 IT stock trading near $133.35, the strikes shown on this page are snapped to the nearest listed IT chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are IT 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 IT butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 47.80%), the computed maximum profit is $493.48 per contract and the computed maximum loss is -$470.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a IT butterfly?: The breakeven for the IT butterfly priced on this page is roughly $129.70 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 IT market-implied 1-standard-deviation expected move is approximately 13.70%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on IT?: Butterflies on IT are pinning bets - traders use them when they expect IT 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 IT implied volatility affect this butterfly?: IT ATM IV is at 47.80% with IV rank near 35.09%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.