POET Butterfly Strategy
POET (POET Technologies Inc.), in the Technology sector, (Semiconductors industry), listed on NASDAQ.
POET Technologies Inc. designs, develops, manufactures, and sells discrete and integrated opto-electronic solutions in Canada, the United States, and Singapore. It offers integration solutions based on the POET Optical Interposer, a novel platform that allows the seamless integration of electronic and photonic devices into a single multi-chip module using advanced wafer-level semiconductor manufacturing techniques and packaging methods. It also develops photonic integrated components. The company serves the data center, telecommunications, Internet of things and industrial sensing, automotive LIDAR, optical coherence tomography for medical devices, virtual reality systems markets. The company was formerly known as Opel Technologies Inc. and changed its name to POET Technologies Inc. in June 2013. POET Technologies Inc. was incorporated in 1972 and is headquartered in Toronto, Canada.
POET (POET Technologies Inc.) trades in the Technology sector, specifically Semiconductors, with a market capitalization of approximately $1.75B, a beta of 0.54 versus the broader market, a 52-week range of 3.87-15.5, average daily share volume of 26.8M, a public-listing history dating back to 2008, approximately 53 full-time employees. These structural characteristics shape how POET stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.54 indicates POET 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 POET?
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 POET snapshot
As of May 15, 2026, spot at $16.73, ATM IV 191.64%, IV rank 96.73%, expected move 54.94%. The butterfly on POET 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 28-day expiry.
Why this butterfly structure on POET specifically: POET IV at 191.64% is rich versus its 1-year range, which makes a premium-buying POET butterfly relatively expensive in absolute-cost terms, with a market-implied 1-standard-deviation move of approximately 54.94% (roughly $9.19 on the underlying). The 28-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated POET expiries trade a higher absolute premium for lower per-day decay. Position sizing on POET should anchor to the underlying notional of $16.73 per share and to the trader's directional view on POET stock.
POET butterfly setup
The POET 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 POET near $16.73, the first option leg uses a $16.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed POET chain at a 28-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 POET shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $16.00 | $3.88 |
| Sell 2 | Call | $17.00 | $3.55 |
| Buy 1 | Call | $18.00 | $3.20 |
POET butterfly risk and reward
- Net Premium / Debit
- +$2.50
- Max Profit (per contract)
- $101.21
- Max Loss (per contract)
- $2.50
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- 40.485
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.
POET butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on POET. 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 | -99.9% | +$2.50 |
| $3.71 | -77.8% | +$2.50 |
| $7.41 | -55.7% | +$2.50 |
| $11.10 | -33.6% | +$2.50 |
| $14.80 | -11.5% | +$2.50 |
| $18.50 | +10.6% | +$2.50 |
| $22.20 | +32.7% | +$2.50 |
| $25.90 | +54.8% | +$2.50 |
| $29.59 | +76.9% | +$2.50 |
| $33.29 | +99.0% | +$2.50 |
When traders use butterfly on POET
Butterflies on POET are pinning bets - traders use them when they expect POET 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.
POET thesis for this butterfly
The market-implied 1-standard-deviation range for POET extends from approximately $7.54 on the downside to $25.92 on the upside. A POET long call butterfly is a pinning play: it pays maximum at the middle strike if POET settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current POET IV rank near 96.73% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on POET at 191.64%. As a Technology name, POET options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to POET-specific events.
POET 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. POET positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move POET alongside the broader basket even when POET-specific fundamentals are unchanged. Always rebuild the position from current POET chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on POET?
- A butterfly on POET is the butterfly strategy applied to POET (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 POET stock trading near $16.73, the strikes shown on this page are snapped to the nearest listed POET chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are POET 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 POET butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 191.64%), the computed maximum profit is $101.21 per contract and the computed maximum loss is $2.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a POET butterfly?
- The breakeven for the POET 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 POET market-implied 1-standard-deviation expected move is approximately 54.94%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on POET?
- Butterflies on POET are pinning bets - traders use them when they expect POET 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 POET implied volatility affect this butterfly?
- POET ATM IV is at 191.64% with IV rank near 96.73%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.