How are TEL 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 TEL butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 45.70%), the computed maximum profit is $805.04 per contract and the computed maximum loss is -$597.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a TEL butterfly?

The breakeven for the TEL butterfly priced on this page is roughly $185.87 and $204.03 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 TEL market-implied 1-standard-deviation expected move is approximately 13.10%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current TEL implied volatility affect this butterfly?

TEL ATM IV is at 45.70% with IV rank near 84.15%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.

TEL Butterfly Strategy

TEL (TE Connectivity plc), in the Technology sector, (Semiconductors industry), listed on NYSE.

TE Connectivity plc, together with its subsidiaries, manufactures and sells connectivity and sensor solutions in Europe, the Middle East, Africa, the AsiaPacific, and the Americas. The company operates through two reportable segments, Transportation Solutions and Industrial Solutions. It provides antennas, application tooling, cable assemblies, connectors, electromagnetic compatibility/electromagnetic interference solutions, energy and power, fiber optics, heat shrink tubing, identification and labeling, medical components, passive components, relays and contactors, sensors, switches, terminals and splices, wires and cables, and wire protection and management solutions. The company also offers training and other services, including 3D printing for production, back shells prototyping, electrical installation training, HarnWare software, machine tooling service and repair, medical device design services, microfluidic devices, and sensor manufacturing services as well as conducts automotive webinars. It serves 5G and wireless equipment, aerospace, appliances, automation and control, automotive, autosport, commercial and industrial vehicles, connected home, data centers and artificial intelligence, defense and military, energy solutions, e-mobility, industrial machinery, intelligent buildings, IoT connectivity, medical technologies, oil and gas/marine, personal electronics and wearable technology, rail, sensor applications, space, and other industries. The company was formerly known as Tyco Electronics Ltd. and changed its name to TE Connectivity plc in March 2011.

TEL (TE Connectivity plc) trades in the Technology sector, specifically Semiconductors, with a market capitalization of approximately $57.72B, a trailing P/E of 19.94, a beta of 1.16 versus the broader market, a 52-week range of 166.73-252.56, average daily share volume of 2.7M, a public-listing history dating back to 2007, approximately 90K full-time employees. These structural characteristics shape how TEL stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.16 places TEL roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. TEL pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on TEL?

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 TEL snapshot

As of June 29, 2026, spot at $196.99, ATM IV 45.70%, IV rank 84.15%, expected move 13.10%. The butterfly on TEL 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 TEL specifically: TEL IV at 45.70% is rich versus its 1-year range, which makes a premium-buying TEL butterfly relatively expensive in absolute-cost terms, with a market-implied 1-standard-deviation move of approximately 13.10% (roughly $25.81 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 TEL expiries trade a higher absolute premium for lower per-day decay. Position sizing on TEL should anchor to the underlying notional of $196.99 per share and to the trader's directional view on TEL stock.

TEL butterfly setup

The TEL 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 TEL near $196.99, the first option leg uses a $185.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed TEL 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 TEL shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$185.00	$15.85
Sell 2	Call	$195.00	$9.10
Buy 1	Call	$210.00	$3.33

TEL butterfly risk and reward

Net Premium / Debit: -$97.50
Max Profit (per contract): $805.04
Max Loss (per contract): -$597.50
Breakeven(s): $185.87, $204.03
Risk / Reward Ratio: 1.347

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.

TEL butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on TEL. 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	-100.0%	-$97.50
$43.56	-77.9%	-$97.50
$87.12	-55.8%	-$97.50
$130.67	-33.7%	-$97.50
$174.23	-11.6%	-$97.50
$217.78	+10.6%	-$597.50
$261.34	+32.7%	-$597.50
$304.89	+54.8%	-$597.50
$348.45	+76.9%	-$597.50
$392.00	+99.0%	-$597.50

When traders use butterfly on TEL

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

TEL thesis for this butterfly

The market-implied 1-standard-deviation range for TEL extends from approximately $171.18 on the downside to $222.80 on the upside. A TEL long call butterfly is a pinning play: it pays maximum at the middle strike if TEL settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current TEL IV rank near 84.15% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on TEL at 45.70%. As a Technology name, TEL options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to TEL-specific events.

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

Frequently asked questions

What is a butterfly on TEL?: A butterfly on TEL is the butterfly strategy applied to TEL (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 TEL stock trading near $196.99, the strikes shown on this page are snapped to the nearest listed TEL chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are TEL 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 TEL butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 45.70%), the computed maximum profit is $805.04 per contract and the computed maximum loss is -$597.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a TEL butterfly?: The breakeven for the TEL butterfly priced on this page is roughly $185.87 and $204.03 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 TEL market-implied 1-standard-deviation expected move is approximately 13.10%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on TEL?: Butterflies on TEL are pinning bets - traders use them when they expect TEL 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 TEL implied volatility affect this butterfly?: TEL ATM IV is at 45.70% with IV rank near 84.15%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.