PH Butterfly Strategy
PH (Parker-Hannifin Corporation), in the Industrials sector, (Industrial - Machinery industry), listed on NYSE.
Parker-Hannifin Corporation manufactures and sells motion and control technologies and systems for various mobile, industrial, and aerospace markets worldwide. The company operates through two segments, Diversified Industrial and Aerospace Systems. The Company's Diversified Industrial segment offers sealing, shielding, thermal products and systems, adhesives, coatings, and noise vibration and harshness solutions; filters, systems, and diagnostics solutions to monitor and remove contaminants from fuel, air, oil, water, and other liquids and gases; connectors, which control, transmit, and contain fluid; control solutions for extreme corrosion resistance, temperatures, pressures, and precise flow; and hydraulic, pneumatic, and electromechanical components and systems for builders and users of mobile and industrial machinery and equipment. This segment sells its products to original equipment manufacturers (OEMs) and distributors who serve the replacement markets in manufacturing, packaging, processing, transportation, construction, refrigeration and air conditioning, agricultural, and military machinery and equipment industries. Its Aerospace Systems segment offers products for use in commercial and military airframe and engine programs, such as control actuation systems and components, engine build-up ducting, engine exhaust nozzles and assemblies, engine systems and components, fluid conveyance systems and components, fuel systems and components, fuel tank inerting systems, hydraulic systems and components, lubrication components, pilot controls, pneumatic control components, thermal management products, and wheels and brakes, as well as fluid metering, delivery, and atomization devices. This segment markets its products directly to OEMs and end users.
PH (Parker-Hannifin Corporation) trades in the Industrials sector, specifically Industrial - Machinery, with a market capitalization of approximately $111.25B, a trailing P/E of 32.00, a beta of 1.18 versus the broader market, a 52-week range of 637.21-1034.96, average daily share volume of 754K, a public-listing history dating back to 1980, approximately 61K full-time employees. These structural characteristics shape how PH stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.18 places PH roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. PH pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on PH?
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 PH snapshot
As of May 15, 2026, spot at $862.07, ATM IV 28.40%, IV rank 37.40%, expected move 8.14%. The butterfly on PH 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 PH specifically: PH IV at 28.40% 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 8.14% (roughly $70.19 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 PH expiries trade a higher absolute premium for lower per-day decay. Position sizing on PH should anchor to the underlying notional of $862.07 per share and to the trader's directional view on PH stock.
PH butterfly setup
The PH 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 PH near $862.07, the first option leg uses a $820.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PH 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 PH shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $820.00 | $57.10 |
| Sell 2 | Call | $860.00 | $31.10 |
| Buy 1 | Call | $910.00 | $11.70 |
PH butterfly risk and reward
- Net Premium / Debit
- -$660.00
- Max Profit (per contract)
- $3,114.30
- Max Loss (per contract)
- -$1,660.00
- Breakeven(s)
- $826.60, $893.40
- Risk / Reward Ratio
- 1.876
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.
PH butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on PH. 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% | -$660.00 |
| $190.62 | -77.9% | -$660.00 |
| $381.22 | -55.8% | -$660.00 |
| $571.83 | -33.7% | -$660.00 |
| $762.44 | -11.6% | -$660.00 |
| $953.05 | +10.6% | -$1,660.00 |
| $1,143.65 | +32.7% | -$1,660.00 |
| $1,334.26 | +54.8% | -$1,660.00 |
| $1,524.87 | +76.9% | -$1,660.00 |
| $1,715.48 | +99.0% | -$1,660.00 |
When traders use butterfly on PH
Butterflies on PH are pinning bets - traders use them when they expect PH 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.
PH thesis for this butterfly
The market-implied 1-standard-deviation range for PH extends from approximately $791.88 on the downside to $932.26 on the upside. A PH long call butterfly is a pinning play: it pays maximum at the middle strike if PH settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current PH IV rank near 37.40% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on PH should anchor more to the directional view and the expected-move geometry. As a Industrials name, PH options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PH-specific events.
PH 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. PH positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PH alongside the broader basket even when PH-specific fundamentals are unchanged. Always rebuild the position from current PH chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on PH?
- A butterfly on PH is the butterfly strategy applied to PH (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 PH stock trading near $862.07, the strikes shown on this page are snapped to the nearest listed PH chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PH 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 PH butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 28.40%), the computed maximum profit is $3,114.30 per contract and the computed maximum loss is -$1,660.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a PH butterfly?
- The breakeven for the PH butterfly priced on this page is roughly $826.60 and $893.40 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 PH market-implied 1-standard-deviation expected move is approximately 8.14%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on PH?
- Butterflies on PH are pinning bets - traders use them when they expect PH 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 PH implied volatility affect this butterfly?
- PH ATM IV is at 28.40% with IV rank near 37.40%, 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.