How are NEO 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 NEO butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 76.30%), the computed maximum profit is $70.00 per contract and the computed maximum loss is -$30.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a NEO butterfly?

The breakeven for the NEO butterfly priced on this page is roughly $14.30 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 NEO market-implied 1-standard-deviation expected move is approximately 21.87%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current NEO implied volatility affect this butterfly?

NEO ATM IV is at 76.30% with IV rank near 14.57%, 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.

NEO Butterfly Strategy

NEO (NeoGenomics, Inc.), in the Healthcare sector, (Medical - Diagnostics & Research industry), listed on NASDAQ.

NeoGenomics, Inc. specializes in providing cancer-focused diagnostic and testing services through an extensive network of laboratories located across the United States, Europe, and Asia. The company operates through two distinct divisions: Clinical Services and Pharma Services. Its comprehensive offerings cater to a diverse clientele, including hospitals, reference laboratories, pathologists, oncologists, clinicians, pharmaceutical companies, and researchers. NeoGenomics' advanced testing capabilities encompass cytogenetics, which examines normal and abnormal chromosomes in relation to disease; fluorescence in-situ hybridization (FISH) for detecting and pinpointing specific DNA sequences and genes on chromosomes; and flow cytometry, used to measure cell population characteristics. Additionally, the company provides immunohistochemistry and digital imaging services, enabling the localization of cellular proteins in tissue sections, visualization of scanned slides, and quantitative analysis. Molecular testing, focusing on DNA/RNA analysis and gene structure/function, is also a key offering, alongside morphologic analysis where pathologists microscopically diagnose cells.

NEO (NeoGenomics, Inc.) trades in the Healthcare sector, specifically Medical - Diagnostics & Research, with a market capitalization of approximately $369.0M, a beta of 1.81 versus the broader market, a 52-week range of 4.72-14.23, average daily share volume of 2.5M, a public-listing history dating back to 2004, approximately 2K full-time employees. These structural characteristics shape how NEO stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.81 indicates NEO has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.

What is a butterfly on NEO?

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 NEO snapshot

As of June 30, 2026, spot at $14.63, ATM IV 76.30%, IV rank 14.57%, expected move 21.87%. The butterfly on NEO 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 NEO specifically: NEO IV at 76.30% is on the cheap side of its 1-year range, which favors premium-buying structures like a NEO butterfly, with a market-implied 1-standard-deviation move of approximately 21.87% (roughly $3.20 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 NEO expiries trade a higher absolute premium for lower per-day decay. Position sizing on NEO should anchor to the underlying notional of $14.63 per share and to the trader's directional view on NEO stock.

NEO butterfly setup

The NEO 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 NEO near $14.63, the first option leg uses a $14.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed NEO 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 NEO shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$14.00	$0.98
Sell 2	Call	$15.00	$0.68
Buy 1	Call	$15.00	$0.68

NEO butterfly risk and reward

Net Premium / Debit: -$30.00
Max Profit (per contract): $70.00
Max Loss (per contract): -$30.00
Breakeven(s): $14.30
Risk / Reward Ratio: 2.333

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.

NEO butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on NEO. 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	-99.9%	-$30.00
$3.24	-77.8%	-$30.00
$6.48	-55.7%	-$30.00
$9.71	-33.6%	-$30.00
$12.94	-11.5%	-$30.00
$16.18	+10.6%	+$70.00
$19.41	+32.7%	+$70.00
$22.65	+54.8%	+$70.00
$25.88	+76.9%	+$70.00
$29.11	+99.0%	+$70.00

When traders use butterfly on NEO

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

NEO thesis for this butterfly

The market-implied 1-standard-deviation range for NEO extends from approximately $11.43 on the downside to $17.83 on the upside. A NEO long call butterfly is a pinning play: it pays maximum at the middle strike if NEO settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current NEO IV rank near 14.57% 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 NEO at 76.30%. As a Healthcare name, NEO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to NEO-specific events.

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

Frequently asked questions

What is a butterfly on NEO?: A butterfly on NEO is the butterfly strategy applied to NEO (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 NEO stock trading near $14.63, the strikes shown on this page are snapped to the nearest listed NEO chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are NEO 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 NEO butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 76.30%), the computed maximum profit is $70.00 per contract and the computed maximum loss is -$30.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a NEO butterfly?: The breakeven for the NEO butterfly priced on this page is roughly $14.30 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 NEO market-implied 1-standard-deviation expected move is approximately 21.87%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on NEO?: Butterflies on NEO are pinning bets - traders use them when they expect NEO 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 NEO implied volatility affect this butterfly?: NEO ATM IV is at 76.30% with IV rank near 14.57%, 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.