NDSN Butterfly Strategy
NDSN (Nordson Corporation), in the Industrials sector, (Industrial - Machinery industry), listed on NASDAQ.
Nordson Corporation engineers, manufactures, and markets products and systems to dispense, apply, and control adhesives, coatings, polymers, sealants, biomaterials, medical components, and other fluids. The Industrial Precision Solutions segment provides dispensing, coating, and laminating systems for adhesives, lotions, liquids, and fibers to disposable products and roll goods; automated adhesive dispensing systems; components and systems for thermoplastic and biopolymer melt stream; fluid components, such as nozzles, pumps, and filters; smart components that measure and control the flow, quantity and location of dispensed fluid; control systems; and product assembly solutions. It also offers automated and manual dispensing products and systems for cold materials, container coating, liquid finishing, and powder coating, as well as ultraviolet equipment. The Medical and Fluid Solutions segment offers precision manual and semi-automated dispensers, plastic molded syringes, cartridges, tips, and fluid connection components; interventional solutions for engineered shafts and interventional delivery systems, medical tubing, balloons, balloon inflators, nitinol devices, cardiovascular cannula, and biomaterial delivery; medical fluid components; and microplegia myocardial protection devices and related consumables. The Advanced Technology Solutions segment provides automated dispensing systems for high-speed, precise application of various attachment, protection, and coating fluids, and related gas plasma treatment systems; destructive and non-destructive testing technologies, such as bond testers and automated optical, acoustic microscopy, and x-ray inspection systems used in the semiconductor and printed circuit board industries; and precision measurement and control technologies. The company markets its products through direct sales force, distributors, and sales representatives.
NDSN (Nordson Corporation) trades in the Industrials sector, specifically Industrial - Machinery, with a market capitalization of approximately $17.34B, a trailing P/E of 32.88, a beta of 0.97 versus the broader market, a 52-week range of 211.5-315.68, average daily share volume of 379K, a public-listing history dating back to 1980, approximately 8K full-time employees. These structural characteristics shape how NDSN stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.97 places NDSN roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. NDSN pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on NDSN?
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.
NDSN snapshot
As of August 14, 2026, spot at $308.64, ATM IV 25.50%, IV rank 36.81%, expected move 7.31%. The butterfly on NDSN 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 NDSN specifically: NDSN IV at 25.50% 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 7.31% (roughly $22.56 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 NDSN expiries trade a higher absolute premium for lower per-day decay. Position sizing on NDSN should anchor to the underlying notional of $308.64 per share and to the trader's directional view on NDSN stock.
NDSN butterfly setup
The NDSN 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 NDSN at $308.64 on that close, the first option leg uses a $290.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed NDSN 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 NDSN shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $290.00 | $22.65 |
| Sell 2 | Call | $310.00 | $9.20 |
| Buy 1 | Call | $320.00 | $5.50 |
NDSN butterfly risk and reward
- Net Premium / Debit
- -$975.00
- Max Profit (per contract)
- $1,005.41
- Max Loss (per contract)
- -$975.00
- Breakeven(s)
- $299.75
- Risk / Reward Ratio
- 1.031
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.
NDSN butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on NDSN. 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% | -$975.00 |
| $68.25 | -77.9% | -$975.00 |
| $136.49 | -55.8% | -$975.00 |
| $204.73 | -33.7% | -$975.00 |
| $272.97 | -11.6% | -$975.00 |
| $341.21 | +10.6% | +$25.00 |
| $409.46 | +32.7% | +$25.00 |
| $477.70 | +54.8% | +$25.00 |
| $545.94 | +76.9% | +$25.00 |
| $614.18 | +99.0% | +$25.00 |
When traders use butterfly on NDSN
Butterflies on NDSN are pinning bets - traders use them when they expect NDSN 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.
NDSN thesis for this butterfly
The market-implied 1-standard-deviation range for NDSN extends from approximately $286.08 on the downside to $331.20 on the upside. A NDSN long call butterfly is a pinning play: it pays maximum at the middle strike if NDSN settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current NDSN IV rank near 36.81% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on NDSN should anchor more to the directional view and the expected-move geometry. As a Industrials name, NDSN options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to NDSN-specific events.
NDSN 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. NDSN positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move NDSN alongside the broader basket even when NDSN-specific fundamentals are unchanged. Always rebuild the position from current NDSN chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on NDSN?
- A butterfly on NDSN is the butterfly strategy applied to NDSN (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 NDSN stock at $308.64 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed NDSN chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are NDSN 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 NDSN butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 25.50%), the computed maximum profit is $1,005.41 per contract and the computed maximum loss is -$975.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a NDSN butterfly?
- The breakeven for the NDSN butterfly priced on this page is roughly $299.75 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 NDSN market-implied 1-standard-deviation expected move in the same options snapshot is approximately 7.31%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on NDSN?
- Butterflies on NDSN are pinning bets - traders use them when they expect NDSN 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 NDSN implied volatility affect this butterfly?
- NDSN ATM IV is at 25.50% with IV rank near 36.81%, 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.