How are PLMR 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 PLMR butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 36.70%), the computed maximum profit is $378.23 per contract and the computed maximum loss is -$67.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a PLMR butterfly?

The breakeven for the PLMR butterfly priced on this page is roughly $120.68 and $129.34 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 PLMR market-implied 1-standard-deviation expected move is approximately 10.52%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current PLMR implied volatility affect this butterfly?

PLMR ATM IV is at 36.70% with IV rank near 30.57%, 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.

PLMR Butterfly Strategy

PLMR (Palomar Holdings, Inc.), in the Financial Services sector, (Insurance - Property & Casualty industry), listed on NASDAQ.

Palomar Holdings, Inc. functions as an insurance holding company dedicated to providing specialized property coverage for both private homeowners and businesses. Its comprehensive product range encompasses essential offerings such as residential and commercial earthquake policies, commercial all-risk protection, tailored homeowners' insurance, inland marine coverage, and Hawaii hurricane policies. Furthermore, the company extends its services to include residential and commercial flood insurance, along with other specialized financial products like assumed reinsurance, real estate error and omission (E&O) coverage, and specific solutions for real estate investors. Palomar distributes its policies through a varied network, including independent retail agents, wholesale brokers, program administrators, and collaborative agreements with other insurance carriers. The company, which was previously named GC Palomar Holdings, was founded in 2013 and maintains its corporate headquarters in La Jolla, California.

PLMR (Palomar Holdings, Inc.) trades in the Financial Services sector, specifically Insurance - Property & Casualty, with a market capitalization of approximately $3.35B, a trailing P/E of 17.03, a beta of 0.44 versus the broader market, a 52-week range of 100.81-156.55, average daily share volume of 265K, a public-listing history dating back to 2019, approximately 253 full-time employees. These structural characteristics shape how PLMR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.44 indicates PLMR has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.

What is a butterfly on PLMR?

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 PLMR snapshot

As of June 29, 2026, spot at $124.91, ATM IV 36.70%, IV rank 30.57%, expected move 10.52%. The butterfly on PLMR 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 18-day expiry.

Why this butterfly structure on PLMR specifically: PLMR IV at 36.70% 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 10.52% (roughly $13.14 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated PLMR expiries trade a higher absolute premium for lower per-day decay. Position sizing on PLMR should anchor to the underlying notional of $124.91 per share and to the trader's directional view on PLMR stock.

PLMR butterfly setup

The PLMR 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 PLMR near $124.91, the first option leg uses a $120.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PLMR chain at a 18-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 PLMR shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$120.00	$7.20
Sell 2	Call	$125.00	$4.15
Buy 1	Call	$130.00	$1.78

PLMR butterfly risk and reward

Net Premium / Debit: -$67.50
Max Profit (per contract): $378.23
Max Loss (per contract): -$67.50
Breakeven(s): $120.68, $129.34
Risk / Reward Ratio: 5.603

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.

PLMR butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on PLMR. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$67.50
$27.63	-77.9%	-$67.50
$55.24	-55.8%	-$67.50
$82.86	-33.7%	-$67.50
$110.48	-11.6%	-$67.50
$138.10	+10.6%	-$67.50
$165.71	+32.7%	-$67.50
$193.33	+54.8%	-$67.50
$220.95	+76.9%	-$67.50
$248.56	+99.0%	-$67.50

When traders use butterfly on PLMR

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

PLMR thesis for this butterfly

The market-implied 1-standard-deviation range for PLMR extends from approximately $111.77 on the downside to $138.05 on the upside. A PLMR long call butterfly is a pinning play: it pays maximum at the middle strike if PLMR settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current PLMR IV rank near 30.57% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on PLMR should anchor more to the directional view and the expected-move geometry. As a Financial Services name, PLMR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PLMR-specific events.

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

Frequently asked questions

What is a butterfly on PLMR?: A butterfly on PLMR is the butterfly strategy applied to PLMR (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 PLMR stock trading near $124.91, the strikes shown on this page are snapped to the nearest listed PLMR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are PLMR 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 PLMR butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 36.70%), the computed maximum profit is $378.23 per contract and the computed maximum loss is -$67.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a PLMR butterfly?: The breakeven for the PLMR butterfly priced on this page is roughly $120.68 and $129.34 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 PLMR market-implied 1-standard-deviation expected move is approximately 10.52%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on PLMR?: Butterflies on PLMR are pinning bets - traders use them when they expect PLMR 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 PLMR implied volatility affect this butterfly?: PLMR ATM IV is at 36.70% with IV rank near 30.57%, 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.