PSKY Butterfly Strategy
PSKY (Paramount Skydance Corporation Class B Common Stock), in the Communication Services sector, (Entertainment industry), listed on NASDAQ.
Paramount Skydance Corporation operates as a media, streaming, and entertainment company worldwide. It operates through TV Media, Direct-to-Consumer, and Filmed Entertainment segments. The TV Media segment operates CBS Television Network, a domestic broadcast television network; CBS Stations, a television station; and international free-to-air networks comprising Network 10, Channel 5, Telefe, and Chilevisión; and domestic premium and basic cable networks, such as Nickelodeon, MTV, CMT, Comedy Central, BET, Paramount+ with SHOWTIME, Paramount Network, The Smithsonian Channel, BET Media Group, CBS Sports Network, and international extensions of these brands. This segment also provides domestic and international television studio operations, including CBS Studios, Paramount Television Studios, and Showtime/MTV Entertainment Studios; CBS Media Ventures, which produces and distributes first run syndicated programming; and digital properties consist of CBS News Streaming and CBS Sports HQ. The Direct-to-Consumer segment offers a portfolio of domestic and international pay and free streaming services, including Paramount+, Pluto TV, and BET+. The Filmed Entertainment segment produces and acquires films, series, and short-form content for release and licensing around the world, including in theaters, on streaming services, on television, through digital home entertainment, and DVDs/Blu-rays; and operates a portfolio consist of Paramount Pictures, Paramount Players, Paramount Animation, Nickelodeon Studio, Awesomeness, and Miramax.
PSKY (Paramount Skydance Corporation Class B Common Stock) trades in the Communication Services sector, specifically Entertainment, with a market capitalization of approximately $11.39B, a beta of 1.45 versus the broader market, a 52-week range of 8.62-20.86, average daily share volume of 13.6M, a public-listing history dating back to 2005, approximately 19K full-time employees. These structural characteristics shape how PSKY stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.45 indicates PSKY has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. PSKY pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on PSKY?
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 PSKY snapshot
As of May 15, 2026, spot at $9.91, ATM IV 43.56%, IV rank 0.00%, expected move 12.49%. The butterfly on PSKY 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 PSKY specifically: PSKY IV at 43.56% is on the cheap side of its 1-year range, which favors premium-buying structures like a PSKY butterfly, with a market-implied 1-standard-deviation move of approximately 12.49% (roughly $1.24 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 PSKY expiries trade a higher absolute premium for lower per-day decay. Position sizing on PSKY should anchor to the underlying notional of $9.91 per share and to the trader's directional view on PSKY stock.
PSKY butterfly setup
The PSKY 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 PSKY near $9.91, the first option leg uses a $9.50 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PSKY 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 PSKY shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $9.50 | $0.70 |
| Sell 2 | Call | $10.00 | $0.44 |
| Buy 1 | Call | $10.50 | $0.20 |
PSKY butterfly risk and reward
- Net Premium / Debit
- -$2.00
- Max Profit (per contract)
- $44.48
- Max Loss (per contract)
- -$2.00
- Breakeven(s)
- $9.50, $10.51
- Risk / Reward Ratio
- 22.239
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.
PSKY butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on PSKY. 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% | -$2.00 |
| $2.20 | -77.8% | -$2.00 |
| $4.39 | -55.7% | -$2.00 |
| $6.58 | -33.6% | -$2.00 |
| $8.77 | -11.5% | -$2.00 |
| $10.96 | +10.6% | -$2.00 |
| $13.15 | +32.7% | -$2.00 |
| $15.34 | +54.8% | -$2.00 |
| $17.53 | +76.9% | -$2.00 |
| $19.72 | +99.0% | -$2.00 |
When traders use butterfly on PSKY
Butterflies on PSKY are pinning bets - traders use them when they expect PSKY 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.
PSKY thesis for this butterfly
The market-implied 1-standard-deviation range for PSKY extends from approximately $8.67 on the downside to $11.15 on the upside. A PSKY long call butterfly is a pinning play: it pays maximum at the middle strike if PSKY settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current PSKY IV rank near 0.00% 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 PSKY at 43.56%. As a Communication Services name, PSKY options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PSKY-specific events.
PSKY 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. PSKY positions also carry Communication Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PSKY alongside the broader basket even when PSKY-specific fundamentals are unchanged. Always rebuild the position from current PSKY chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on PSKY?
- A butterfly on PSKY is the butterfly strategy applied to PSKY (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 PSKY stock trading near $9.91, the strikes shown on this page are snapped to the nearest listed PSKY chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PSKY 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 PSKY butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 43.56%), the computed maximum profit is $44.48 per contract and the computed maximum loss is -$2.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a PSKY butterfly?
- The breakeven for the PSKY butterfly priced on this page is roughly $9.50 and $10.51 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 PSKY market-implied 1-standard-deviation expected move is approximately 12.49%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on PSKY?
- Butterflies on PSKY are pinning bets - traders use them when they expect PSKY 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 PSKY implied volatility affect this butterfly?
- PSKY ATM IV is at 43.56% with IV rank near 0.00%, 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.