RIGL Butterfly Strategy
RIGL (Rigel Pharmaceuticals, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Rigel Pharmaceuticals, Inc., a biotechnology company, develops and provides therapies that enhance the lives of patients with hematologic disorders and cancer in the United States. The company offers TAVALISSE, an oral spleen tyrosine kinase inhibitor for the treatment of adult patients with chronic immune thrombocytopenia; REZLIDHIA, a non-intensive monotherapy to treat adult patients with relapsed or refractory (R/R) acute myeloid leukemia (AML) with a susceptible isocitrate dehydrogenase-1 (IDH1) mutation as detected by an FDA-approved test; and GAVRETO, a once daily, small molecule, oral, kinase inhibitor for the treatment of adult patients with metastatic rearranged during transfection (RET) fusion-positive non-small cell lung cancer (NSCLC), as well as to treat adult and pediatric patients twelve years of age and older with advanced or metastatic RET fusion-positive thyroid cancer. It also develops R289, an oral interleukin receptor-associated kinases 1 and 4 (IRAK1/4) inhibitor, which is being advanced to Phase 1b study for the treatment of hematology-oncology, autoimmune, and inflammatory diseases, as well as to treat lower-risk myelodysplastic syndrome. The company has strategic development collaboration with The University of Texas MD Anderson Cancer Center (MDACC) for the development of olutasidenib in AML and other hematologic cancers with IDH1mutations; and the Collaborative Network for Neuro-Oncology Clinical Trial (CONNECT) to conduct a Phase 2 clinical trial to evaluate olutasidenib in combination with temozolomide in patients with high-grade glioma harboring an IDH1 mutation. Rigel Pharmaceuticals, Inc. was incorporated in 1996 and is headquartered in South San Francisco, California.
RIGL (Rigel Pharmaceuticals, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $715.8M, a trailing P/E of 1.96, a beta of 1.18 versus the broader market, a 52-week range of 18.24-52.24, average daily share volume of 387K, a public-listing history dating back to 2000, approximately 174 full-time employees. These structural characteristics shape how RIGL stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.18 places RIGL roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 1.96 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price.
What is a butterfly on RIGL?
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 RIGL snapshot
As of June 29, 2026, spot at $38.73, ATM IV 56.90%, IV rank 10.63%, expected move 16.31%. The butterfly on RIGL 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 18-day expiry.
Why this butterfly structure on RIGL specifically: RIGL IV at 56.90% is on the cheap side of its 1-year range, which favors premium-buying structures like a RIGL butterfly, with a market-implied 1-standard-deviation move of approximately 16.31% (roughly $6.32 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated RIGL expiries trade a higher absolute premium for lower per-day decay. Position sizing on RIGL should anchor to the underlying notional of $38.73 per share and to the trader's directional view on RIGL stock.
RIGL butterfly setup
The RIGL 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 RIGL near $38.73, the first option leg uses a $37.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed RIGL chain at a 18-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 RIGL shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $37.00 | $3.53 |
| Sell 2 | Call | $39.00 | $1.50 |
| Buy 1 | Call | $41.00 | $1.48 |
RIGL butterfly risk and reward
- Net Premium / Debit
- -$200.00
- Max Profit (per contract)
- -$7.04
- Max Loss (per contract)
- -$200.00
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- -0.035
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.
RIGL butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on RIGL. 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% | -$200.00 |
| $8.57 | -77.9% | -$200.00 |
| $17.13 | -55.8% | -$200.00 |
| $25.70 | -33.7% | -$200.00 |
| $34.26 | -11.5% | -$200.00 |
| $42.82 | +10.6% | -$200.00 |
| $51.38 | +32.7% | -$200.00 |
| $59.95 | +54.8% | -$200.00 |
| $68.51 | +76.9% | -$200.00 |
| $77.07 | +99.0% | -$200.00 |
When traders use butterfly on RIGL
Butterflies on RIGL are pinning bets - traders use them when they expect RIGL 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.
RIGL thesis for this butterfly
The market-implied 1-standard-deviation range for RIGL extends from approximately $32.41 on the downside to $45.05 on the upside. A RIGL long call butterfly is a pinning play: it pays maximum at the middle strike if RIGL settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current RIGL IV rank near 10.63% 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 RIGL at 56.90%. As a Healthcare name, RIGL options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RIGL-specific events.
RIGL 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. RIGL positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move RIGL alongside the broader basket even when RIGL-specific fundamentals are unchanged. Always rebuild the position from current RIGL chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on RIGL?
- A butterfly on RIGL is the butterfly strategy applied to RIGL (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 RIGL stock trading near $38.73, the strikes shown on this page are snapped to the nearest listed RIGL chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are RIGL 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 RIGL butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 56.90%), the computed maximum profit is -$7.04 per contract and the computed maximum loss is -$200.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a RIGL butterfly?
- The breakeven for the RIGL 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 RIGL market-implied 1-standard-deviation expected move is approximately 16.31%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on RIGL?
- Butterflies on RIGL are pinning bets - traders use them when they expect RIGL 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 RIGL implied volatility affect this butterfly?
- RIGL ATM IV is at 56.90% with IV rank near 10.63%, 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.