ROIV Butterfly Strategy
ROIV (Roivant Sciences Ltd.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Roivant Sciences Ltd., a biopharmaceutical and healthcare technology company that researches and develops medicines. The company develops product candidates for the treatment of various therapeutics, including solid tumors, sickle cell diseases, hypophosphatasia, oncologic malignancies, psoriasis, atopic dermatitis, vitiligo, hyperhidrosis, acne, myasthenia gravis, warm autoimmune hemolytic anemia, thyroid eye diseases, sarcoidosis, and staph aureus bacteremia. The company was founded in 2014 and is based in London, the United Kingdom.
ROIV (Roivant Sciences Ltd.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $20.91B, a beta of 1.14 versus the broader market, a 52-week range of 10.58-30.33, average daily share volume of 5.4M, a public-listing history dating back to 2020, approximately 908 full-time employees. These structural characteristics shape how ROIV stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.14 places ROIV roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a butterfly on ROIV?
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 ROIV snapshot
As of May 15, 2026, spot at $29.45, ATM IV 60.10%, IV rank 60.65%, expected move 17.23%. The butterfly on ROIV 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 ROIV specifically: ROIV IV at 60.10% 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 17.23% (roughly $5.07 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 ROIV expiries trade a higher absolute premium for lower per-day decay. Position sizing on ROIV should anchor to the underlying notional of $29.45 per share and to the trader's directional view on ROIV stock.
ROIV butterfly setup
The ROIV 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 ROIV near $29.45, the first option leg uses a $28.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ROIV 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 ROIV shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $28.00 | $2.88 |
| Sell 2 | Call | $29.00 | $2.08 |
| Buy 1 | Call | $31.00 | $1.18 |
ROIV butterfly risk and reward
- Net Premium / Debit
- +$10.00
- Max Profit (per contract)
- $108.89
- Max Loss (per contract)
- -$90.00
- Breakeven(s)
- $30.10
- Risk / Reward Ratio
- 1.210
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.
ROIV butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on ROIV. 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% | +$10.00 |
| $6.52 | -77.9% | +$10.00 |
| $13.03 | -55.8% | +$10.00 |
| $19.54 | -33.6% | +$10.00 |
| $26.05 | -11.5% | +$10.00 |
| $32.56 | +10.6% | -$90.00 |
| $39.07 | +32.7% | -$90.00 |
| $45.58 | +54.8% | -$90.00 |
| $52.09 | +76.9% | -$90.00 |
| $58.60 | +99.0% | -$90.00 |
When traders use butterfly on ROIV
Butterflies on ROIV are pinning bets - traders use them when they expect ROIV 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.
ROIV thesis for this butterfly
The market-implied 1-standard-deviation range for ROIV extends from approximately $24.38 on the downside to $34.52 on the upside. A ROIV long call butterfly is a pinning play: it pays maximum at the middle strike if ROIV settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current ROIV IV rank near 60.65% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on ROIV should anchor more to the directional view and the expected-move geometry. As a Healthcare name, ROIV options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ROIV-specific events.
ROIV 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. ROIV positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ROIV alongside the broader basket even when ROIV-specific fundamentals are unchanged. Always rebuild the position from current ROIV chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on ROIV?
- A butterfly on ROIV is the butterfly strategy applied to ROIV (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 ROIV stock trading near $29.45, the strikes shown on this page are snapped to the nearest listed ROIV chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ROIV 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 ROIV butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 60.10%), the computed maximum profit is $108.89 per contract and the computed maximum loss is -$90.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a ROIV butterfly?
- The breakeven for the ROIV butterfly priced on this page is roughly $30.10 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 ROIV market-implied 1-standard-deviation expected move is approximately 17.23%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on ROIV?
- Butterflies on ROIV are pinning bets - traders use them when they expect ROIV 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 ROIV implied volatility affect this butterfly?
- ROIV ATM IV is at 60.10% with IV rank near 60.65%, 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.