How are KNF 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 KNF butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 51.60%), the computed maximum profit is $371.30 per contract and the computed maximum loss is -$100.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a KNF butterfly?

The breakeven for the KNF butterfly priced on this page is roughly $81.00 and $89.00 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 KNF market-implied 1-standard-deviation expected move is approximately 14.79%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current KNF implied volatility affect this butterfly?

KNF ATM IV is at 51.60% with IV rank near 48.73%, 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.

KNF Butterfly Strategy

KNF (Knife River Corporation), in the Basic Materials sector, (Construction Materials industry), listed on NYSE.

Knife River Corporation is a U.S.-based entity focused on supplying aggregate-derived building materials and offering related contracting services. Its business activities are structured across six distinct operational segments: Pacific, Northwest, Mountain, North Central, South, and Energy Services. The company is involved in extracting, processing, and distributing crucial construction aggregates, including varieties of crushed stone, sand, and gravel. Additionally, it produces and sells both asphalt and ready-mix concrete. To support these core product lines, Knife River also performs various contracting tasks, such as heavy-civil construction, paving with asphalt and concrete, and comprehensive site development and grading work. Its primary clients are governmental bodies at the federal, state, and municipal levels, for whom it undertakes a wide range of public infrastructure initiatives.

KNF (Knife River Corporation) trades in the Basic Materials sector, specifically Construction Materials, with a market capitalization of approximately $5.28B, a trailing P/E of 35.97, a beta of 0.53 versus the broader market, a 52-week range of 58.72-96.28, average daily share volume of 568K, a public-listing history dating back to 2023, approximately 5K full-time employees. These structural characteristics shape how KNF stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.53 indicates KNF has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. The trailing P/E of 35.97 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 KNF?

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 KNF snapshot

As of June 30, 2026, spot at $83.45, ATM IV 51.60%, IV rank 48.73%, expected move 14.79%. The butterfly on KNF 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 52-day expiry.

Why this butterfly structure on KNF specifically: KNF IV at 51.60% 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 14.79% (roughly $12.35 on the underlying). The 52-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated KNF expiries trade a higher absolute premium for lower per-day decay. Position sizing on KNF should anchor to the underlying notional of $83.45 per share and to the trader's directional view on KNF stock.

KNF butterfly setup

The KNF 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 KNF near $83.45, 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 KNF chain at a 52-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 KNF shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$80.00	$8.50
Sell 2	Call	$85.00	$6.00
Buy 1	Call	$90.00	$4.50

KNF butterfly risk and reward

Net Premium / Debit: -$100.00
Max Profit (per contract): $371.30
Max Loss (per contract): -$100.00
Breakeven(s): $81.00, $89.00
Risk / Reward Ratio: 3.713

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.

KNF butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on KNF. 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%	-$100.00
$18.46	-77.9%	-$100.00
$36.91	-55.8%	-$100.00
$55.36	-33.7%	-$100.00
$73.81	-11.6%	-$100.00
$92.26	+10.6%	-$100.00
$110.71	+32.7%	-$100.00
$129.16	+54.8%	-$100.00
$147.61	+76.9%	-$100.00
$166.06	+99.0%	-$100.00

When traders use butterfly on KNF

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

KNF thesis for this butterfly

The market-implied 1-standard-deviation range for KNF extends from approximately $71.10 on the downside to $95.80 on the upside. A KNF long call butterfly is a pinning play: it pays maximum at the middle strike if KNF settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current KNF IV rank near 48.73% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on KNF should anchor more to the directional view and the expected-move geometry. As a Basic Materials name, KNF options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to KNF-specific events.

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

Frequently asked questions

What is a butterfly on KNF?: A butterfly on KNF is the butterfly strategy applied to KNF (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 KNF stock trading near $83.45, the strikes shown on this page are snapped to the nearest listed KNF chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are KNF 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 KNF butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 51.60%), the computed maximum profit is $371.30 per contract and the computed maximum loss is -$100.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a KNF butterfly?: The breakeven for the KNF butterfly priced on this page is roughly $81.00 and $89.00 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 KNF market-implied 1-standard-deviation expected move is approximately 14.79%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on KNF?: Butterflies on KNF are pinning bets - traders use them when they expect KNF 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 KNF implied volatility affect this butterfly?: KNF ATM IV is at 51.60% with IV rank near 48.73%, 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.