PKOH Butterfly Strategy
PKOH (Park-Ohio Holdings Corp.), in the Industrials sector, (Industrial - Machinery industry), listed on NASDAQ.
Park-Ohio Holdings Corp. provides supply chain management outsourcing services, capital equipment, and manufactured components in the United States, Europe, Asia, Mexico, Canada, and internationally. It operates through three segments: Supply Technologies, Assembly Components, and Engineered Products. The Supply Technologies segment offers Total Supply Management solution, including engineering and design support, part usage and cost analysis, supplier selection, quality assurance, bar coding, product packaging and tracking, just-in-time and point-of-use delivery, electronic billing, and ongoing technical support services, as well as provides spare parts and aftermarket products; and production components, such as valves, fuel hose assemblies, electro-mechanical hardware, labels, fittings, steering components, and other products. It also engineers and manufactures precision cold-formed and cold-extruded fasteners and other products, including locknuts, SPAC nuts, SPAC bolts, and wheel hardware. The Assembly Components segment manufactures aluminum products, direct fuel injection fuel rails and pipes, fuel filler pipes, and flexible multi-layer plastic and rubber assemblies; turbo charging and coolant hoses; and fluid handling systems. It also offers machining services, as well as value-added services, such as design engineering, machining, and part assembly.
PKOH (Park-Ohio Holdings Corp.) trades in the Industrials sector, specifically Industrial - Machinery, with a market capitalization of approximately $433.0M, a trailing P/E of 16.94, a beta of 1.17 versus the broader market, a 52-week range of 15.52-31.92, average daily share volume of 45K, a public-listing history dating back to 1973, approximately 6K full-time employees. These structural characteristics shape how PKOH stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.17 places PKOH roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. PKOH pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on PKOH?
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 PKOH snapshot
As of May 15, 2026, spot at $30.74, ATM IV 88.80%, IV rank 17.48%, expected move 25.46%. The butterfly on PKOH 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 PKOH specifically: PKOH IV at 88.80% is on the cheap side of its 1-year range, which favors premium-buying structures like a PKOH butterfly, with a market-implied 1-standard-deviation move of approximately 25.46% (roughly $7.83 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 PKOH expiries trade a higher absolute premium for lower per-day decay. Position sizing on PKOH should anchor to the underlying notional of $30.74 per share and to the trader's directional view on PKOH stock.
PKOH butterfly setup
The PKOH 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 PKOH near $30.74, the first option leg uses a $29.20 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PKOH 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 PKOH shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $29.20 | N/A |
| Sell 2 | Call | $30.74 | N/A |
| Buy 1 | Call | $32.28 | N/A |
PKOH butterfly risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
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.
PKOH butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on PKOH. 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.
When traders use butterfly on PKOH
Butterflies on PKOH are pinning bets - traders use them when they expect PKOH 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.
PKOH thesis for this butterfly
The market-implied 1-standard-deviation range for PKOH extends from approximately $22.91 on the downside to $38.57 on the upside. A PKOH long call butterfly is a pinning play: it pays maximum at the middle strike if PKOH settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current PKOH IV rank near 17.48% 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 PKOH at 88.80%. As a Industrials name, PKOH options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PKOH-specific events.
PKOH 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. PKOH positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PKOH alongside the broader basket even when PKOH-specific fundamentals are unchanged. Always rebuild the position from current PKOH chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on PKOH?
- A butterfly on PKOH is the butterfly strategy applied to PKOH (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 PKOH stock trading near $30.74, the strikes shown on this page are snapped to the nearest listed PKOH chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PKOH 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 PKOH butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 88.80%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a PKOH butterfly?
- The breakeven for the PKOH butterfly priced on this page is no defined breakeven on the modeled curve 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 PKOH market-implied 1-standard-deviation expected move is approximately 25.46%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on PKOH?
- Butterflies on PKOH are pinning bets - traders use them when they expect PKOH 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 PKOH implied volatility affect this butterfly?
- PKOH ATM IV is at 88.80% with IV rank near 17.48%, 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.