How are MLM 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 MLM butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 29.40%), the computed maximum profit is $1,806.73 per contract and the computed maximum loss is -$937.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a MLM butterfly?

The breakeven for the MLM butterfly priced on this page is roughly $559.38 and $600.63 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 MLM market-implied 1-standard-deviation expected move is approximately 8.43%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current MLM implied volatility affect this butterfly?

MLM ATM IV is at 29.40% with IV rank near 49.57%, 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.

MLM Butterfly Strategy

MLM (Martin Marietta Materials, Inc.), in the Basic Materials sector, (Construction Materials industry), listed on NYSE.

Martin Marietta Materials, Inc. functions as a company specializing in natural resource-derived building materials. This enterprise delivers a wide range of aggregates and other heavy construction components to the building industry, serving both domestic and international markets. Its product portfolio includes foundational raw materials like crushed stone, sand, and gravel, in addition to manufactured items such as ready-mix concrete, asphalt, and comprehensive paving solutions. These offerings are essential for infrastructure projects, commercial and residential developments, and various other sectors including railroads, agriculture, utilities, and environmental applications. Beyond its core construction offerings, Martin Marietta also produces magnesia-based chemicals, which are utilized in industrial, agricultural, and environmental contexts. The company further supplies dolomitic lime, primarily for steel manufacturing and soil stabilization.

MLM (Martin Marietta Materials, Inc.) trades in the Basic Materials sector, specifically Construction Materials, with a market capitalization of approximately $36.99B, a trailing P/E of 14.66, a beta of 1.10 versus the broader market, a 52-week range of 525.38-710.97, average daily share volume of 505K, a public-listing history dating back to 1994, approximately 9K full-time employees. These structural characteristics shape how MLM stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.10 places MLM roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. MLM pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on MLM?

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 MLM snapshot

As of June 30, 2026, spot at $579.64, ATM IV 29.40%, IV rank 49.57%, expected move 8.43%. The butterfly on MLM 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 17-day expiry.

Why this butterfly structure on MLM specifically: MLM IV at 29.40% 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 8.43% (roughly $48.86 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated MLM expiries trade a higher absolute premium for lower per-day decay. Position sizing on MLM should anchor to the underlying notional of $579.64 per share and to the trader's directional view on MLM stock.

MLM butterfly setup

The MLM 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 MLM near $579.64, the first option leg uses a $550.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MLM chain at a 17-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 MLM shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$550.00	$34.75
Sell 2	Call	$580.00	$15.55
Buy 1	Call	$610.00	$5.73

MLM butterfly risk and reward

Net Premium / Debit: -$937.50
Max Profit (per contract): $1,806.73
Max Loss (per contract): -$937.50
Breakeven(s): $559.38, $600.63
Risk / Reward Ratio: 1.927

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.

MLM butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on MLM. 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%	-$937.50
$128.17	-77.9%	-$937.50
$256.33	-55.8%	-$937.50
$384.49	-33.7%	-$937.50
$512.65	-11.6%	-$937.50
$640.81	+10.6%	-$937.50
$768.97	+32.7%	-$937.50
$897.13	+54.8%	-$937.50
$1,025.29	+76.9%	-$937.50
$1,153.45	+99.0%	-$937.50

When traders use butterfly on MLM

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

MLM thesis for this butterfly

The market-implied 1-standard-deviation range for MLM extends from approximately $530.78 on the downside to $628.50 on the upside. A MLM long call butterfly is a pinning play: it pays maximum at the middle strike if MLM settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current MLM IV rank near 49.57% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on MLM should anchor more to the directional view and the expected-move geometry. As a Basic Materials name, MLM options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MLM-specific events.

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

Frequently asked questions

What is a butterfly on MLM?: A butterfly on MLM is the butterfly strategy applied to MLM (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 MLM stock trading near $579.64, the strikes shown on this page are snapped to the nearest listed MLM chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are MLM 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 MLM butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 29.40%), the computed maximum profit is $1,806.73 per contract and the computed maximum loss is -$937.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a MLM butterfly?: The breakeven for the MLM butterfly priced on this page is roughly $559.38 and $600.63 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 MLM market-implied 1-standard-deviation expected move is approximately 8.43%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on MLM?: Butterflies on MLM are pinning bets - traders use them when they expect MLM 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 MLM implied volatility affect this butterfly?: MLM ATM IV is at 29.40% with IV rank near 49.57%, 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.