How are MRSH 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 MRSH butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 20.70%), the computed maximum profit is $601.64 per contract and the computed maximum loss is -$327.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a MRSH butterfly?

The breakeven for the MRSH butterfly priced on this page is roughly $183.28 and $196.73 at expiration, derived from the August 14, 2026 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 MRSH market-implied 1-standard-deviation expected move in the same options snapshot is approximately 5.93%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current MRSH implied volatility affect this butterfly?

MRSH ATM IV is at 20.70% with IV rank near 2.89%, 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.

MRSH Butterfly Strategy

MRSH (Marsh & McLennan Companies, Inc.), in the Financial Services sector, (Insurance - Brokers industry), listed on NYSE.

Marsh & McLennan Companies, Inc. (MRSH) functions as a leading professional services organization, delivering expert guidance and innovative solutions to clients across the vital domains of risk management, strategic planning, and human capital. Based in New York City, the firm maintains a substantial global workforce, employing approximately 65,000 full-time professionals. This entity serves as the parent company for several prominent advisory and consulting brands. These include Marsh, renowned for its insurance brokerage services; Guy Carpenter, a specialist in risk and reinsurance; Mercer, which provides comprehensive human resources and investment-related financial advice; and Oliver Wyman Group, an influential management and economic consultancy. Marsh & McLennan structures its operations into two core business segments. The "Risk and Insurance Services" division encompasses activities such as risk management, along with comprehensive insurance and reinsurance brokerage and services.

MRSH (Marsh & McLennan Companies, Inc.) trades in the Financial Services sector, specifically Insurance - Brokers, with a market capitalization of approximately $90.13B, a trailing P/E of 22.87, a beta of 0.58 versus the broader market, a 52-week range of 156.6-213.8, average daily share volume of 2.8M, a public-listing history dating back to 1987, approximately 95K full-time employees. These structural characteristics shape how MRSH stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.58 indicates MRSH has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. MRSH pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on MRSH?

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.

MRSH snapshot

As of August 14, 2026, spot at $188.34, ATM IV 20.70%, IV rank 2.89%, expected move 5.93%. The butterfly on MRSH below is built from the August 14, 2026 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 MRSH specifically: MRSH IV at 20.70% is on the cheap side of its 1-year range, which favors premium-buying structures like a MRSH butterfly, with a market-implied 1-standard-deviation move of approximately 5.93% (roughly $11.18 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 MRSH expiries trade a higher absolute premium for lower per-day decay. Position sizing on MRSH should anchor to the underlying notional of $188.34 per share and to the trader's directional view on MRSH stock.

MRSH butterfly setup

The MRSH butterfly below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With MRSH at $188.34 on that close, the first option leg uses a $180.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MRSH 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 MRSH shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$180.00	$11.00
Sell 2	Call	$190.00	$4.40
Buy 1	Call	$200.00	$1.08

MRSH butterfly risk and reward

Net Premium / Debit: -$327.50
Max Profit (per contract): $601.64
Max Loss (per contract): -$327.50
Breakeven(s): $183.28, $196.73
Risk / Reward Ratio: 1.837

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.

MRSH butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on MRSH. 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%	-$327.50
$41.65	-77.9%	-$327.50
$83.29	-55.8%	-$327.50
$124.94	-33.7%	-$327.50
$166.58	-11.6%	-$327.50
$208.22	+10.6%	-$327.50
$249.86	+32.7%	-$327.50
$291.50	+54.8%	-$327.50
$333.15	+76.9%	-$327.50
$374.79	+99.0%	-$327.50

When traders use butterfly on MRSH

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

MRSH thesis for this butterfly

The market-implied 1-standard-deviation range for MRSH extends from approximately $177.16 on the downside to $199.52 on the upside. A MRSH long call butterfly is a pinning play: it pays maximum at the middle strike if MRSH settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current MRSH IV rank near 2.89% 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 MRSH at 20.70%. As a Financial Services name, MRSH options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MRSH-specific events.

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

Frequently asked questions

What is a butterfly on MRSH?: A butterfly on MRSH is the butterfly strategy applied to MRSH (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 MRSH stock at $188.34 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed MRSH chain strike and the premiums come straight from that session's bid/ask midpoint.
How are MRSH 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 MRSH butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 20.70%), the computed maximum profit is $601.64 per contract and the computed maximum loss is -$327.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a MRSH butterfly?: The breakeven for the MRSH butterfly priced on this page is roughly $183.28 and $196.73 at expiration, derived from the August 14, 2026 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 MRSH market-implied 1-standard-deviation expected move in the same options snapshot is approximately 5.93%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on MRSH?: Butterflies on MRSH are pinning bets - traders use them when they expect MRSH 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 MRSH implied volatility affect this butterfly?: MRSH ATM IV is at 20.70% with IV rank near 2.89%, 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.