MC Butterfly Strategy
MC (Moelis & Company), in the Financial Services sector, (Financial - Capital Markets industry), listed on NYSE.
Moelis & Company operates as an investment banking advisory firm. It offers advisory services in the areas of mergers and acquisitions, recapitalizations and restructurings, capital markets transactions, and other corporate finance matters. The company offers its services to public multinational corporations, middle market private companies, financial sponsors, entrepreneurs, governments, and sovereign wealth funds. The company serves its clients in North and South America, Europe, the Middle East, Asia, and Australia. It has strategic alliances in Mexico with Alfaro, Dávila y Scherer, S.C.; and in Australia with MA Moelis Australia. The company was founded in 2007 and is headquartered in New York, New York.
MC (Moelis & Company) trades in the Financial Services sector, specifically Financial - Capital Markets, with a market capitalization of approximately $4.77B, a trailing P/E of 21.85, a beta of 1.87 versus the broader market, a 52-week range of 51.06-78.216, average daily share volume of 1.3M, a public-listing history dating back to 2014, approximately 1K full-time employees. These structural characteristics shape how MC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.87 indicates MC has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. MC pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on MC?
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 MC snapshot
As of May 15, 2026, spot at $63.77, ATM IV 40.80%, IV rank 5.19%, expected move 11.70%. The butterfly on MC 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 34-day expiry.
Why this butterfly structure on MC specifically: MC IV at 40.80% is on the cheap side of its 1-year range, which favors premium-buying structures like a MC butterfly, with a market-implied 1-standard-deviation move of approximately 11.70% (roughly $7.46 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated MC expiries trade a higher absolute premium for lower per-day decay. Position sizing on MC should anchor to the underlying notional of $63.77 per share and to the trader's directional view on MC stock.
MC butterfly setup
The MC 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 MC near $63.77, the first option leg uses a $60.58 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MC chain at a 34-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 MC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $60.58 | N/A |
| Sell 2 | Call | $63.77 | N/A |
| Buy 1 | Call | $66.96 | N/A |
MC 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.
MC butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on MC. 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 MC
Butterflies on MC are pinning bets - traders use them when they expect MC 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.
MC thesis for this butterfly
The market-implied 1-standard-deviation range for MC extends from approximately $56.31 on the downside to $71.23 on the upside. A MC long call butterfly is a pinning play: it pays maximum at the middle strike if MC settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current MC IV rank near 5.19% 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 MC at 40.80%. As a Financial Services name, MC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MC-specific events.
MC 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. MC positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move MC alongside the broader basket even when MC-specific fundamentals are unchanged. Always rebuild the position from current MC chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on MC?
- A butterfly on MC is the butterfly strategy applied to MC (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 MC stock trading near $63.77, the strikes shown on this page are snapped to the nearest listed MC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are MC 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 MC butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 40.80%), 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 MC butterfly?
- The breakeven for the MC butterfly priced on this page is no defined breakeven on the modeled curve 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 MC market-implied 1-standard-deviation expected move is approximately 11.70%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on MC?
- Butterflies on MC are pinning bets - traders use them when they expect MC 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 MC implied volatility affect this butterfly?
- MC ATM IV is at 40.80% with IV rank near 5.19%, 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.