PLD Butterfly Strategy
PLD (Prologis, Inc.), in the Real Estate sector, (REIT - Industrial industry), listed on NYSE.
Prologis, Inc. is the undisputed global leader in logistics real estate, strategically focusing its operations on high-barrier, high-growth markets. As of December 31, 2020, the company's extensive portfolio spanned approximately 984 million square feet (91 million square meters) of both existing properties and planned development projects, located across 19 countries. This significant footprint is managed through a blend of wholly-owned assets and co-investment ventures. Prologis leases its contemporary logistics facilities to a diverse client base of roughly 5,500 customers, primarily serving business-to-business (B2B) and retail/online fulfillment needs.
PLD (Prologis, Inc.) trades in the Real Estate sector, specifically REIT - Industrial, with a market capitalization of approximately $131.59B, a trailing P/E of 31.27, a beta of 1.32 versus the broader market, a 52-week range of 105.42-153.35, average daily share volume of 4.1M, a public-listing history dating back to 1997, approximately 3K full-time employees. These structural characteristics shape how PLD stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.32 indicates PLD has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. PLD pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on PLD?
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.
PLD snapshot
As of August 14, 2026, spot at $141.13, ATM IV 22.40%, IV rank 12.90%, expected move 6.42%. The butterfly on PLD below is built from the August 14, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.
Why this butterfly structure on PLD specifically: PLD IV at 22.40% is on the cheap side of its 1-year range, which favors premium-buying structures like a PLD butterfly, with a market-implied 1-standard-deviation move of approximately 6.42% (roughly $9.06 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated PLD expiries trade a higher absolute premium for lower per-day decay. Position sizing on PLD should anchor to the underlying notional of $141.13 per share and to the trader's directional view on PLD stock.
PLD butterfly setup
The PLD butterfly below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With PLD at $141.13 on that close, the first option leg uses a $135.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PLD chain at a 35-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 PLD shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $135.00 | $7.95 |
| Sell 2 | Call | $140.00 | $4.45 |
| Buy 1 | Call | $150.00 | $0.85 |
PLD butterfly risk and reward
- Net Premium / Debit
- +$10.00
- Max Profit (per contract)
- $467.42
- Max Loss (per contract)
- -$490.00
- Breakeven(s)
- $145.10
- Risk / Reward Ratio
- 0.954
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.
PLD butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on PLD. 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% | +$10.00 |
| $31.21 | -77.9% | +$10.00 |
| $62.42 | -55.8% | +$10.00 |
| $93.62 | -33.7% | +$10.00 |
| $124.82 | -11.6% | +$10.00 |
| $156.03 | +10.6% | -$490.00 |
| $187.23 | +32.7% | -$490.00 |
| $218.43 | +54.8% | -$490.00 |
| $249.64 | +76.9% | -$490.00 |
| $280.84 | +99.0% | -$490.00 |
When traders use butterfly on PLD
Butterflies on PLD are pinning bets - traders use them when they expect PLD 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.
PLD thesis for this butterfly
The market-implied 1-standard-deviation range for PLD extends from approximately $132.07 on the downside to $150.19 on the upside. A PLD long call butterfly is a pinning play: it pays maximum at the middle strike if PLD settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current PLD IV rank near 12.90% 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 PLD at 22.40%. As a Real Estate name, PLD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PLD-specific events.
PLD 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. PLD positions also carry Real Estate sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PLD alongside the broader basket even when PLD-specific fundamentals are unchanged. Always rebuild the position from current PLD chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on PLD?
- A butterfly on PLD is the butterfly strategy applied to PLD (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 PLD stock at $141.13 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed PLD chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are PLD 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 PLD butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 22.40%), the computed maximum profit is $467.42 per contract and the computed maximum loss is -$490.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a PLD butterfly?
- The breakeven for the PLD butterfly priced on this page is roughly $145.10 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The PLD market-implied 1-standard-deviation expected move in the same options snapshot is approximately 6.42%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on PLD?
- Butterflies on PLD are pinning bets - traders use them when they expect PLD 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 PLD implied volatility affect this butterfly?
- PLD ATM IV is at 22.40% with IV rank near 12.90%, 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.