PRGS Butterfly Strategy
PRGS (Progress Software Corporation), in the Technology sector, (Software - Application industry), listed on NASDAQ.
Progress Software Corporation develops, deploys, and manages business applications. The company offers OpenEdge, a development software, which builds multi-language applications for secure deployment across various platforms and devices, as well as cloud; developer tools that consists of components for user interface development for Web, mobile, desktop, chat, and AR/VR apps, as well as automated application testing and reporting tools; Sitefinity, a web content management and customer analytics platform; Corticon, a business rules management system that provides applications with decision automation and change process, and decision-related insight capabilities. It also offers DataDirect Connect, which provides data connectivity using industry-standard interfaces to connect applications running on various platforms; MOVEit that offers secure collaboration and automated file transfers of critical business information; Chef, an infrastructure automation platform to build, deploy, manage, and secure applications in multi-cloud and hybrid environments, and on-premises; and WhatsUp Gold, a network monitoring solution. In addition, the company provides Kemp LoadMaster, a load balancing solutions; and Kemp Flowmon network performance monitoring and diagnostic solutions that collect and analyze network telemetry from various sources. Further, it provides project management, implementation, custom development, programming, and other services, as well as web-enable applications; and training services. The company sells its products to end users, independent software vendors, original equipment manufacturers, and system integrators.
PRGS (Progress Software Corporation) trades in the Technology sector, specifically Software - Application, with a market capitalization of approximately $1.11B, a trailing P/E of 13.08, a beta of 0.78 versus the broader market, a 52-week range of 23.82-65.5, average daily share volume of 1.1M, a public-listing history dating back to 1991, approximately 3K full-time employees. These structural characteristics shape how PRGS stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.78 places PRGS roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. PRGS pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on PRGS?
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 PRGS snapshot
As of May 14, 2026, spot at $26.72, ATM IV 58.70%, IV rank 47.50%, expected move 16.83%. The butterfly on PRGS 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 217-day expiry.
Why this butterfly structure on PRGS specifically: PRGS IV at 58.70% 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 16.83% (roughly $4.50 on the underlying). The 217-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated PRGS expiries trade a higher absolute premium for lower per-day decay. Position sizing on PRGS should anchor to the underlying notional of $26.72 per share and to the trader's directional view on PRGS stock.
PRGS butterfly setup
The PRGS 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 PRGS near $26.72, the first option leg uses a $25.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PRGS chain at a 217-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 PRGS shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $25.00 | $6.75 |
| Sell 2 | Call | $27.50 | $5.60 |
| Buy 1 | Call | $27.50 | $5.60 |
PRGS butterfly risk and reward
- Net Premium / Debit
- -$115.00
- Max Profit (per contract)
- $135.00
- Max Loss (per contract)
- -$115.00
- Breakeven(s)
- $26.15
- Risk / Reward Ratio
- 1.174
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.
PRGS butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on PRGS. 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% | -$115.00 |
| $5.92 | -77.9% | -$115.00 |
| $11.82 | -55.7% | -$115.00 |
| $17.73 | -33.6% | -$115.00 |
| $23.64 | -11.5% | -$115.00 |
| $29.54 | +10.6% | +$135.00 |
| $35.45 | +32.7% | +$135.00 |
| $41.36 | +54.8% | +$135.00 |
| $47.26 | +76.9% | +$135.00 |
| $53.17 | +99.0% | +$135.00 |
When traders use butterfly on PRGS
Butterflies on PRGS are pinning bets - traders use them when they expect PRGS 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.
PRGS thesis for this butterfly
The market-implied 1-standard-deviation range for PRGS extends from approximately $22.22 on the downside to $31.22 on the upside. A PRGS long call butterfly is a pinning play: it pays maximum at the middle strike if PRGS settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current PRGS IV rank near 47.50% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on PRGS should anchor more to the directional view and the expected-move geometry. As a Technology name, PRGS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PRGS-specific events.
PRGS 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. PRGS positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PRGS alongside the broader basket even when PRGS-specific fundamentals are unchanged. Always rebuild the position from current PRGS chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on PRGS?
- A butterfly on PRGS is the butterfly strategy applied to PRGS (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 PRGS stock trading near $26.72, the strikes shown on this page are snapped to the nearest listed PRGS chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PRGS 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 PRGS butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 58.70%), the computed maximum profit is $135.00 per contract and the computed maximum loss is -$115.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a PRGS butterfly?
- The breakeven for the PRGS butterfly priced on this page is roughly $26.15 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 PRGS market-implied 1-standard-deviation expected move is approximately 16.83%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on PRGS?
- Butterflies on PRGS are pinning bets - traders use them when they expect PRGS 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 PRGS implied volatility affect this butterfly?
- PRGS ATM IV is at 58.70% with IV rank near 47.50%, 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.