How are MKTX 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 MKTX butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 33.80%), the computed maximum profit is $652.93 per contract and the computed maximum loss is -$332.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a MKTX butterfly?

The breakeven for the MKTX butterfly priced on this page is roughly $133.33 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 MKTX market-implied 1-standard-deviation expected move is approximately 9.69%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current MKTX implied volatility affect this butterfly?

MKTX ATM IV is at 33.80% with IV rank near 41.25%, 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.

MKTX Butterfly Strategy

MKTX (MarketAxess Holdings Inc.), in the Financial Services sector, (Financial - Capital Markets industry), listed on NASDAQ.

MarketAxess Holdings Inc., together with its subsidiaries, operates an electronic trading platform for institutional investor and broker-dealer companies worldwide. It offers the access to liquidity in the U.S. investment-grade bonds, U.S. high-yield bonds, and U.S. Treasuries, as well as municipal bonds, emerging market debts, Eurobonds, and other fixed income securities. The company, through its Open Trading protocols, executes bond trades between and among institutional investor and broker-dealer clients in an all-to-all anonymous trading environment for corporate bonds. It also offers trading-related products and services, including composite+ pricing and other market data products to assist clients with trading decisions; auto-execution and other execution services for clients requiring specialized workflow solutions; connectivity solutions that facilitate straight-through processing; and technology services to optimize trading environments. In addition, the company provides various pre-and post-trade services, such as trade matching, trade publication, regulatory transaction reporting, and market and reference data across a range of fixed-income and other products.

MKTX (MarketAxess Holdings Inc.) trades in the Financial Services sector, specifically Financial - Capital Markets, with a market capitalization of approximately $4.95B, a trailing P/E of 15.89, a beta of 0.92 versus the broader market, a 52-week range of 137.27-228.16, average daily share volume of 489K, a public-listing history dating back to 2004, approximately 891 full-time employees. These structural characteristics shape how MKTX stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.92 places MKTX roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. MKTX pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on MKTX?

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 MKTX snapshot

As of May 15, 2026, spot at $139.44, ATM IV 33.80%, IV rank 41.25%, expected move 9.69%. The butterfly on MKTX 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 MKTX specifically: MKTX IV at 33.80% 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 9.69% (roughly $13.51 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 MKTX expiries trade a higher absolute premium for lower per-day decay. Position sizing on MKTX should anchor to the underlying notional of $139.44 per share and to the trader's directional view on MKTX stock.

MKTX butterfly setup

The MKTX 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 MKTX near $139.44, the first option leg uses a $130.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MKTX 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 MKTX shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$130.00	$12.10
Sell 2	Call	$140.00	$6.05
Buy 1	Call	$145.00	$3.33

MKTX butterfly risk and reward

Net Premium / Debit: -$332.50
Max Profit (per contract): $652.93
Max Loss (per contract): -$332.50
Breakeven(s): $133.33
Risk / Reward Ratio: 1.964

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.

MKTX butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on MKTX. 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%	-$332.50
$30.84	-77.9%	-$332.50
$61.67	-55.8%	-$332.50
$92.50	-33.7%	-$332.50
$123.33	-11.6%	-$332.50
$154.16	+10.6%	+$167.50
$184.99	+32.7%	+$167.50
$215.82	+54.8%	+$167.50
$246.65	+76.9%	+$167.50
$277.48	+99.0%	+$167.50

When traders use butterfly on MKTX

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

MKTX thesis for this butterfly

The market-implied 1-standard-deviation range for MKTX extends from approximately $125.93 on the downside to $152.95 on the upside. A MKTX long call butterfly is a pinning play: it pays maximum at the middle strike if MKTX settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current MKTX IV rank near 41.25% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on MKTX should anchor more to the directional view and the expected-move geometry. As a Financial Services name, MKTX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MKTX-specific events.

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

Frequently asked questions

What is a butterfly on MKTX?: A butterfly on MKTX is the butterfly strategy applied to MKTX (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 MKTX stock trading near $139.44, the strikes shown on this page are snapped to the nearest listed MKTX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are MKTX 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 MKTX butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 33.80%), the computed maximum profit is $652.93 per contract and the computed maximum loss is -$332.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a MKTX butterfly?: The breakeven for the MKTX butterfly priced on this page is roughly $133.33 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 MKTX market-implied 1-standard-deviation expected move is approximately 9.69%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on MKTX?: Butterflies on MKTX are pinning bets - traders use them when they expect MKTX 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 MKTX implied volatility affect this butterfly?: MKTX ATM IV is at 33.80% with IV rank near 41.25%, 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.