LBRX Butterfly Strategy
LBRX (LB Pharmaceuticals Inc Common Stock), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
This biopharmaceutical firm is currently in the clinical development stage, concentrating on the creation of innovative treatments for neuropsychiatric disorders such as schizophrenia and bipolar depression. Central to their pipeline is LB-102, their primary investigational drug, which is a methylated variant of amisulpride.
LBRX (LB Pharmaceuticals Inc Common Stock) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $1.30B, a beta of 0.42 versus the broader market, a 52-week range of 13.36-49.14, average daily share volume of 290K, a public-listing history dating back to 2025, approximately 35 full-time employees. These structural characteristics shape how LBRX stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.42 indicates LBRX has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.
What is a butterfly on LBRX?
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.
LBRX snapshot
As of August 14, 2026, spot at $47.32, ATM IV 69.80%, expected move 20.01%. The butterfly on LBRX below is built from the end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.
Why this butterfly structure on LBRX specifically: IV rank is unavailable in the current snapshot, so regime-based timing for LBRX is inferred from ATM IV at 69.80% alone, with a market-implied 1-standard-deviation move of approximately 20.01% (roughly $9.47 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated LBRX expiries trade a higher absolute premium for lower per-day decay. Position sizing on LBRX should anchor to the underlying notional of $47.32 per share and to the trader's directional view on LBRX stock.
LBRX butterfly setup
The LBRX 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 LBRX at $47.32 on that close, the first option leg uses a $44.95 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed LBRX chain at a 35-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 LBRX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $44.95 | N/A |
| Sell 2 | Call | $47.32 | N/A |
| Buy 1 | Call | $49.69 | N/A |
LBRX butterfly risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
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.
LBRX butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on LBRX. 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.
When traders use butterfly on LBRX
Butterflies on LBRX are pinning bets - traders use them when they expect LBRX 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.
LBRX thesis for this butterfly
The market-implied 1-standard-deviation range for LBRX extends from approximately $37.85 on the downside to $56.79 on the upside. A LBRX long call butterfly is a pinning play: it pays maximum at the middle strike if LBRX settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. As a Healthcare name, LBRX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to LBRX-specific events.
LBRX 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. LBRX positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move LBRX alongside the broader basket even when LBRX-specific fundamentals are unchanged. Always rebuild the position from current LBRX chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on LBRX?
- A butterfly on LBRX is the butterfly strategy applied to LBRX (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 LBRX stock at $47.32 on the most recent close, the strikes shown on this page are snapped to the nearest listed LBRX chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are LBRX 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 LBRX butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 69.80%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a LBRX butterfly?
- The breakeven for the LBRX butterfly priced on this page is no defined breakeven on the modeled curve at expiration, derived from the 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 LBRX market-implied 1-standard-deviation expected move in the same options snapshot is approximately 20.01%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on LBRX?
- Butterflies on LBRX are pinning bets - traders use them when they expect LBRX 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 LBRX implied volatility affect this butterfly?
- Current LBRX ATM IV is 69.80%; IV rank context is unavailable in the current snapshot.