RICK Butterfly Strategy
RICK (RCI Hospitality Holdings, Inc.), in the Consumer Cyclical sector, (Restaurants industry), listed on NASDAQ.
RCI Hospitality Holdings, Inc., through its subsidiaries, engages in the hospitality and related businesses in the United States. The company operates through Nightclubs, Bombshells, and Other segments. It owns and/or operates upscale adult nightclubs serving primarily businessmen and professionals under the Rick's Cabaret, Jaguars Club, Tootsie's Cabaret, XTC Cabaret, Club Onyx, Hoops Cabaret and Sports Bar, Scarlett's Cabaret, Temptations Adult Cabaret, Foxy's Cabaret, Vivid Cabaret, Downtown Cabaret, Cabaret East, The Seville, Silver City Cabaret, and Kappa Men's Club. The company also operates restaurants and sports bars under the Bombshells Restaurant & Bar brand, as well as a dance club under the Studio 80 brand. In addition, it owns two national industry trade publications serving the adult nightclubs industry and the adult retail products industry; a national industry convention and tradeshow; and two national industry award shows, as well as approximately a dozen industry and social media Websites. Further, RCI Hospitality Holdings, Inc. holds license to sell Robust Energy Drink in the United States.
RICK (RCI Hospitality Holdings, Inc.) trades in the Consumer Cyclical sector, specifically Restaurants, with a market capitalization of approximately $186.5M, a beta of 0.76 versus the broader market, a 52-week range of 20.76-44, average daily share volume of 66K, a public-listing history dating back to 1995, approximately 4K full-time employees. These structural characteristics shape how RICK stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.76 places RICK roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. RICK pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on RICK?
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 RICK snapshot
As of May 15, 2026, spot at $24.21, ATM IV 50.90%, IV rank 6.77%, expected move 14.59%. The butterfly on RICK 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 34-day expiry.
Why this butterfly structure on RICK specifically: RICK IV at 50.90% is on the cheap side of its 1-year range, which favors premium-buying structures like a RICK butterfly, with a market-implied 1-standard-deviation move of approximately 14.59% (roughly $3.53 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated RICK expiries trade a higher absolute premium for lower per-day decay. Position sizing on RICK should anchor to the underlying notional of $24.21 per share and to the trader's directional view on RICK stock.
RICK butterfly setup
The RICK 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 RICK near $24.21, the first option leg uses a $23.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed RICK chain at a 34-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 RICK shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $23.00 | N/A |
| Sell 2 | Call | $24.21 | N/A |
| Buy 1 | Call | $25.42 | N/A |
RICK butterfly risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
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.
RICK butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on RICK. 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.
When traders use butterfly on RICK
Butterflies on RICK are pinning bets - traders use them when they expect RICK 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.
RICK thesis for this butterfly
The market-implied 1-standard-deviation range for RICK extends from approximately $20.68 on the downside to $27.74 on the upside. A RICK long call butterfly is a pinning play: it pays maximum at the middle strike if RICK settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current RICK IV rank near 6.77% 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 RICK at 50.90%. As a Consumer Cyclical name, RICK options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RICK-specific events.
RICK 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. RICK positions also carry Consumer Cyclical sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move RICK alongside the broader basket even when RICK-specific fundamentals are unchanged. Always rebuild the position from current RICK chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on RICK?
- A butterfly on RICK is the butterfly strategy applied to RICK (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 RICK stock trading near $24.21, the strikes shown on this page are snapped to the nearest listed RICK chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are RICK 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 RICK butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 50.90%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a RICK butterfly?
- The breakeven for the RICK 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 RICK market-implied 1-standard-deviation expected move is approximately 14.59%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on RICK?
- Butterflies on RICK are pinning bets - traders use them when they expect RICK 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 RICK implied volatility affect this butterfly?
- RICK ATM IV is at 50.90% with IV rank near 6.77%, 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.