How are PAGP 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 PAGP butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 18.40%), the computed maximum profit is $103.05 per contract and the computed maximum loss is -$92.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a PAGP butterfly?

The breakeven for the PAGP butterfly priced on this page is roughly $23.93 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 PAGP market-implied 1-standard-deviation expected move is approximately 5.28%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current PAGP implied volatility affect this butterfly?

PAGP ATM IV is at 18.40% with IV rank near 1.62%, 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.

PAGP Butterfly Strategy

PAGP (Plains GP Holdings, L.P.), in the Energy sector, (Oil & Gas Midstream industry), listed on NASDAQ.

Plains GP Holdings, L.P., through its subsidiary, Plains All American Pipeline, L.P., owns and operates midstream energy infrastructure in the United States and Canada. The company operates in two segments, Crude Oil and Natural Gas Liquids (NGLs). The company engages in the transportation of crude oil and NGLs on pipelines, gathering systems, and trucks. As of December 31, 2021, this segment owned and leased assets comprising 18,300 miles of crude oil and NGL pipelines and gathering systems; 38 million barrels of above-ground tank capacity; and 1,275 trailers. It engages in the provision of storage, terminalling, and throughput services primarily for crude oil, NGLs, and natural gas; NGL fractionation and isomerization services; and natural gas and condensate processing services. As of December 31, 2021, this segment owned and operated approximately 74 million barrels of crude oil storage capacity; 28 million barrels of NGL storage capacity; four natural gas processing plants; a condensate processing facility; nine fractionation plants; 16 NGL rail terminals; four marine facilities; and 110 miles of pipelines.

PAGP (Plains GP Holdings, L.P.) trades in the Energy sector, specifically Oil & Gas Midstream, with a market capitalization of approximately $4.65B, a trailing P/E of 23.87, a beta of 0.43 versus the broader market, a 52-week range of 16.68-24.76, average daily share volume of 1.9M, a public-listing history dating back to 2013, approximately 5K full-time employees. These structural characteristics shape how PAGP stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.43 indicates PAGP has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. PAGP pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on PAGP?

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 PAGP snapshot

As of May 15, 2026, spot at $24.58, ATM IV 18.40%, IV rank 1.62%, expected move 5.28%. The butterfly on PAGP 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 98-day expiry.

Why this butterfly structure on PAGP specifically: PAGP IV at 18.40% is on the cheap side of its 1-year range, which favors premium-buying structures like a PAGP butterfly, with a market-implied 1-standard-deviation move of approximately 5.28% (roughly $1.30 on the underlying). The 98-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated PAGP expiries trade a higher absolute premium for lower per-day decay. Position sizing on PAGP should anchor to the underlying notional of $24.58 per share and to the trader's directional view on PAGP stock.

PAGP butterfly setup

The PAGP 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 PAGP near $24.58, the first option leg uses a $23.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PAGP chain at a 98-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 PAGP shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$23.00	$2.00
Sell 2	Call	$25.00	$0.75
Buy 1	Call	$26.00	$0.43

PAGP butterfly risk and reward

Net Premium / Debit: -$92.50
Max Profit (per contract): $103.05
Max Loss (per contract): -$92.50
Breakeven(s): $23.93
Risk / Reward Ratio: 1.114

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.

PAGP butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on PAGP. 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%	-$92.50
$5.44	-77.9%	-$92.50
$10.88	-55.7%	-$92.50
$16.31	-33.6%	-$92.50
$21.74	-11.5%	-$92.50
$27.18	+10.6%	+$7.50
$32.61	+32.7%	+$7.50
$38.05	+54.8%	+$7.50
$43.48	+76.9%	+$7.50
$48.91	+99.0%	+$7.50

When traders use butterfly on PAGP

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

PAGP thesis for this butterfly

The market-implied 1-standard-deviation range for PAGP extends from approximately $23.28 on the downside to $25.88 on the upside. A PAGP long call butterfly is a pinning play: it pays maximum at the middle strike if PAGP settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current PAGP IV rank near 1.62% 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 PAGP at 18.40%. As a Energy name, PAGP options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PAGP-specific events.

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

Frequently asked questions

What is a butterfly on PAGP?: A butterfly on PAGP is the butterfly strategy applied to PAGP (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 PAGP stock trading near $24.58, the strikes shown on this page are snapped to the nearest listed PAGP chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are PAGP 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 PAGP butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 18.40%), the computed maximum profit is $103.05 per contract and the computed maximum loss is -$92.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a PAGP butterfly?: The breakeven for the PAGP butterfly priced on this page is roughly $23.93 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 PAGP market-implied 1-standard-deviation expected move is approximately 5.28%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on PAGP?: Butterflies on PAGP are pinning bets - traders use them when they expect PAGP 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 PAGP implied volatility affect this butterfly?: PAGP ATM IV is at 18.40% with IV rank near 1.62%, 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.