RXRX Butterfly Strategy
RXRX (Recursion Pharmaceuticals, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Recursion Pharmaceuticals, Inc. operates as a clinical-stage biotechnology company, engages in the decoding biology by integrating technological innovations across biology, chemistry, automation, data science, and engineering to industrialize drug discovery. The company develops REC-994, which is in Phase IIa clinical trial to treat cerebral cavernous malformation; REC-2282 for the treatment of neurofibromatosis type 2; REC-4881 to treat familial adenomatous polyposis; and REC-3599, which is in Phase I clinical trial to treat GM2 gangliosidosis. Its preclinical stage product includes REC-3964 to treat Clostridium difficile colitis; REC-64917 for the treat of neural or systemic inflammation; REC-65029 to treat HRD-negative ovarian cancer; REC-648918 to enhance anti-tumor immune; REC-2029 for the treatment of wnt-mutant hepatocellular carcinoma; REC-14221 to treat solid and hematological malignancies; and REC-64151 for the treatment of immune checkpoint resistance in KRAS/STK11 mutant non-small cell lung cancer. The company has collaboration and agreement with Bayer AG; the University of Utah Research Foundation; Ohio State Innovation Foundation; Chromaderm, Inc.; and Takeda Pharmaceutical Company Limited. Recursion Pharmaceuticals, Inc. was incorporated in 2013 and is headquartered in Salt Lake City, Utah.
RXRX (Recursion Pharmaceuticals, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $1.36B, a beta of 1.05 versus the broader market, a 52-week range of 2.8-7.18, average daily share volume of 14.2M, a public-listing history dating back to 2021, approximately 800 full-time employees. These structural characteristics shape how RXRX stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.05 places RXRX roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a butterfly on RXRX?
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 RXRX snapshot
As of May 15, 2026, spot at $2.96, ATM IV 64.14%, IV rank 7.29%, expected move 18.39%. The butterfly on RXRX 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 RXRX specifically: RXRX IV at 64.14% is on the cheap side of its 1-year range, which favors premium-buying structures like a RXRX butterfly, with a market-implied 1-standard-deviation move of approximately 18.39% (roughly $0.54 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 RXRX expiries trade a higher absolute premium for lower per-day decay. Position sizing on RXRX should anchor to the underlying notional of $2.96 per share and to the trader's directional view on RXRX stock.
RXRX butterfly setup
The RXRX 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 RXRX near $2.96, the first option leg uses a $2.81 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed RXRX 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 RXRX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $2.81 | N/A |
| Sell 2 | Call | $2.96 | N/A |
| Buy 1 | Call | $3.11 | N/A |
RXRX 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.
RXRX butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on RXRX. 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 RXRX
Butterflies on RXRX are pinning bets - traders use them when they expect RXRX 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.
RXRX thesis for this butterfly
The market-implied 1-standard-deviation range for RXRX extends from approximately $2.42 on the downside to $3.50 on the upside. A RXRX long call butterfly is a pinning play: it pays maximum at the middle strike if RXRX settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current RXRX IV rank near 7.29% 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 RXRX at 64.14%. As a Healthcare name, RXRX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RXRX-specific events.
RXRX 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. RXRX positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move RXRX alongside the broader basket even when RXRX-specific fundamentals are unchanged. Always rebuild the position from current RXRX chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on RXRX?
- A butterfly on RXRX is the butterfly strategy applied to RXRX (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 RXRX stock trading near $2.96, the strikes shown on this page are snapped to the nearest listed RXRX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are RXRX 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 RXRX butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 64.14%), 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 RXRX butterfly?
- The breakeven for the RXRX 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 RXRX market-implied 1-standard-deviation expected move is approximately 18.39%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on RXRX?
- Butterflies on RXRX are pinning bets - traders use them when they expect RXRX 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 RXRX implied volatility affect this butterfly?
- RXRX ATM IV is at 64.14% with IV rank near 7.29%, 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.