How are RDWU 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 RDWU butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 178.90%), the computed maximum profit is $45.00 per contract and the computed maximum loss is -$55.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a RDWU butterfly?

The breakeven for the RDWU butterfly priced on this page is roughly $10.55 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 RDWU market-implied 1-standard-deviation expected move in the same options snapshot is approximately 51.29%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current RDWU implied volatility affect this butterfly?

Current RDWU ATM IV is 178.90%; IV rank context is unavailable in the current snapshot.

RDWU Butterfly Strategy

RDWU (ETF Opportunities Trust - T-REX 2X Long RDW Daily Target ETF), in the Financial Services sector, (Asset Management - Leveraged industry), listed on CBOE.

The T-REX 2X Long RDW Daily Target ETF (RDWU) aims to capitalize on increases in Redwire Corporation's (NYSE: RDW) stock value. It primarily accomplishes this by utilizing swap agreements and publicly traded call options, with the option to also make direct investments in RDW shares. Redwire Corporation plays a crucial role in the expanding space sector, delivering essential solutions and foundational infrastructure for the future of space exploration and development. Its diverse clientele includes government agencies and commercial enterprises globally. The company possesses key intellectual property in areas like solar energy generation and in-space additive manufacturing, assisting its customers in addressing the formidable challenges of upcoming space missions. This ETF endeavors to achieve daily leveraged exposure, targeting a return equivalent to twice (200%) the daily percentage change in RDW's share price, which is managed through a daily rebalancing strategy.

RDWU (ETF Opportunities Trust - T-REX 2X Long RDW Daily Target ETF) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $510,805, a beta of 2.14 versus the broader market, a 52-week range of 3.7-59.29, average daily share volume of 1.7M, a public-listing history dating back to 2026. These structural characteristics shape how RDWU stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 2.14 indicates RDWU has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.

What is a butterfly on RDWU?

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.

RDWU snapshot

As of August 14, 2026, spot at $10.65, ATM IV 178.90%, expected move 51.29%. The butterfly on RDWU 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 RDWU specifically: IV rank is unavailable in the current snapshot, so regime-based timing for RDWU is inferred from ATM IV at 178.90% alone, with a market-implied 1-standard-deviation move of approximately 51.29% (roughly $5.46 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 RDWU expiries trade a higher absolute premium for lower per-day decay. Position sizing on RDWU should anchor to the underlying notional of $10.65 per share and to the trader's directional view on RDWU stock.

RDWU butterfly setup

The RDWU 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 RDWU at $10.65 on that close, the first option leg uses a $10.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed RDWU 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 RDWU shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$10.00	$2.55
Sell 2	Call	$11.00	$2.00
Buy 1	Call	$11.00	$2.00

RDWU butterfly risk and reward

Net Premium / Debit: -$55.00
Max Profit (per contract): $45.00
Max Loss (per contract): -$55.00
Breakeven(s): $10.55
Risk / Reward Ratio: 0.818

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.

RDWU butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on RDWU. 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	-99.9%	-$55.00
$2.36	-77.8%	-$55.00
$4.72	-55.7%	-$55.00
$7.07	-33.6%	-$55.00
$9.42	-11.5%	-$55.00
$11.78	+10.6%	+$45.00
$14.13	+32.7%	+$45.00
$16.49	+54.8%	+$45.00
$18.84	+76.9%	+$45.00
$21.19	+99.0%	+$45.00

When traders use butterfly on RDWU

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

RDWU thesis for this butterfly

The market-implied 1-standard-deviation range for RDWU extends from approximately $5.19 on the downside to $16.11 on the upside. A RDWU long call butterfly is a pinning play: it pays maximum at the middle strike if RDWU settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. As a Financial Services name, RDWU options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RDWU-specific events.

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

Frequently asked questions

What is a butterfly on RDWU?: A butterfly on RDWU is the butterfly strategy applied to RDWU (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 RDWU stock at $10.65 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed RDWU chain strike and the premiums come straight from that session's bid/ask midpoint.
How are RDWU 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 RDWU butterfly priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 178.90%), the computed maximum profit is $45.00 per contract and the computed maximum loss is -$55.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a RDWU butterfly?: The breakeven for the RDWU butterfly priced on this page is roughly $10.55 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 RDWU market-implied 1-standard-deviation expected move in the same options snapshot is approximately 51.29%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on RDWU?: Butterflies on RDWU are pinning bets - traders use them when they expect RDWU 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 RDWU implied volatility affect this butterfly?: Current RDWU ATM IV is 178.90%; IV rank context is unavailable in the current snapshot.