NUVL Butterfly Strategy
NUVL (Nuvalent, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Nuvalent, Inc., a clinical stage biopharmaceutical company, develops therapies for patients with cancer. Its lead product candidates are NVL-520, a brain-penetrant ROS1-selective inhibitor to inhibit ROS1 fusions that express the normal ROS1 kinase domain without any drug-resistant mutations and remain active in the presence of mutations conferring resistance to approved and investigational ROS1 inhibitors, which is under Phase I development; and NVL-655, a brain-penetrant ALK-selective inhibitor, to address the clinical challenges of emergent treatment resistance, central nervous system-related adverse events, and brain metastases that might limit the use of first-, second-, and third-generation ALK inhibitors that is under Phase I/II clinical trial. The company was incorporated in 2017 and is headquartered in Cambridge, Massachusetts.
NUVL (Nuvalent, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $7.74B, a beta of 1.15 versus the broader market, a 52-week range of 68.64-113.015, average daily share volume of 567K, a public-listing history dating back to 2021, approximately 162 full-time employees. These structural characteristics shape how NUVL stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.15 places NUVL roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a butterfly on NUVL?
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 NUVL snapshot
As of May 15, 2026, spot at $102.64, ATM IV 47.30%, IV rank 25.41%, expected move 13.56%. The butterfly on NUVL 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 NUVL specifically: NUVL IV at 47.30% is on the cheap side of its 1-year range, which favors premium-buying structures like a NUVL butterfly, with a market-implied 1-standard-deviation move of approximately 13.56% (roughly $13.92 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 NUVL expiries trade a higher absolute premium for lower per-day decay. Position sizing on NUVL should anchor to the underlying notional of $102.64 per share and to the trader's directional view on NUVL stock.
NUVL butterfly setup
The NUVL 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 NUVL near $102.64, the first option leg uses a $100.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed NUVL 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 NUVL shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $100.00 | $7.30 |
| Sell 2 | Call | $105.00 | $4.90 |
| Buy 1 | Call | $110.00 | $2.93 |
NUVL butterfly risk and reward
- Net Premium / Debit
- -$42.50
- Max Profit (per contract)
- $435.12
- Max Loss (per contract)
- -$42.50
- Breakeven(s)
- $100.43, $109.71
- Risk / Reward Ratio
- 10.238
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.
NUVL butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on NUVL. 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% | -$42.50 |
| $22.70 | -77.9% | -$42.50 |
| $45.40 | -55.8% | -$42.50 |
| $68.09 | -33.7% | -$42.50 |
| $90.78 | -11.6% | -$42.50 |
| $113.48 | +10.6% | -$42.50 |
| $136.17 | +32.7% | -$42.50 |
| $158.86 | +54.8% | -$42.50 |
| $181.56 | +76.9% | -$42.50 |
| $204.25 | +99.0% | -$42.50 |
When traders use butterfly on NUVL
Butterflies on NUVL are pinning bets - traders use them when they expect NUVL 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.
NUVL thesis for this butterfly
The market-implied 1-standard-deviation range for NUVL extends from approximately $88.72 on the downside to $116.56 on the upside. A NUVL long call butterfly is a pinning play: it pays maximum at the middle strike if NUVL settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current NUVL IV rank near 25.41% 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 NUVL at 47.30%. As a Healthcare name, NUVL options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to NUVL-specific events.
NUVL 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. NUVL positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move NUVL alongside the broader basket even when NUVL-specific fundamentals are unchanged. Always rebuild the position from current NUVL chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on NUVL?
- A butterfly on NUVL is the butterfly strategy applied to NUVL (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 NUVL stock trading near $102.64, the strikes shown on this page are snapped to the nearest listed NUVL chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are NUVL 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 NUVL butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 47.30%), the computed maximum profit is $435.12 per contract and the computed maximum loss is -$42.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a NUVL butterfly?
- The breakeven for the NUVL butterfly priced on this page is roughly $100.43 and $109.71 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 NUVL market-implied 1-standard-deviation expected move is approximately 13.56%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on NUVL?
- Butterflies on NUVL are pinning bets - traders use them when they expect NUVL 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 NUVL implied volatility affect this butterfly?
- NUVL ATM IV is at 47.30% with IV rank near 25.41%, 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.