How are TGT 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 TGT butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 43.44%), the computed maximum profit is $435.34 per contract and the computed maximum loss is -$132.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a TGT butterfly?

The breakeven for the TGT butterfly priced on this page is roughly $116.33 and $125.68 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 TGT market-implied 1-standard-deviation expected move is approximately 12.46%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current TGT implied volatility affect this butterfly?

TGT ATM IV is at 43.44% with IV rank near 53.84%, 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.

TGT Butterfly Strategy

TGT (Target Corporation), in the Consumer Defensive sector, (Discount Stores industry), listed on NYSE.

Target Corporation operates as a general merchandise retailer in the United States. The company offers food assortments, including perishables, dry grocery, dairy, and frozen items; apparel, accessories, home décor products, electronics, toys, seasonal offerings, food, and other merchandise; and beauty and household essentials. It also provides in-store amenities, such as Target Café, Target Optical, Starbucks, and other food service offerings. The company sells its products through its stores; and digital channels, including Target.com. As of March 09, 2022, the company operated approximately 2,000 stores. Target Corporation was incorporated in 1902 and is headquartered in Minneapolis, Minnesota.

TGT (Target Corporation) trades in the Consumer Defensive sector, specifically Discount Stores, with a market capitalization of approximately $55.01B, a trailing P/E of 14.85, a beta of 1.01 versus the broader market, a 52-week range of 83.44-133.1, average daily share volume of 5.6M, a public-listing history dating back to 1967, approximately 440K full-time employees. These structural characteristics shape how TGT stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.01 places TGT roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. TGT pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a butterfly on TGT?

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 TGT snapshot

As of May 15, 2026, spot at $120.71, ATM IV 43.44%, IV rank 53.84%, expected move 12.46%. The butterfly on TGT 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 TGT specifically: TGT IV at 43.44% 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 12.46% (roughly $15.03 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 TGT expiries trade a higher absolute premium for lower per-day decay. Position sizing on TGT should anchor to the underlying notional of $120.71 per share and to the trader's directional view on TGT stock.

TGT butterfly setup

The TGT 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 TGT near $120.71, the first option leg uses a $115.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed TGT 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 TGT shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$115.00	$9.75
Sell 2	Call	$121.00	$5.95
Buy 1	Call	$127.00	$3.48

TGT butterfly risk and reward

Net Premium / Debit: -$132.50
Max Profit (per contract): $435.34
Max Loss (per contract): -$132.50
Breakeven(s): $116.33, $125.68
Risk / Reward Ratio: 3.286

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.

TGT butterfly payoff curve

Modeled P&L at expiration across a range of underlying prices for the butterfly on TGT. 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%	-$132.50
$26.70	-77.9%	-$132.50
$53.39	-55.8%	-$132.50
$80.08	-33.7%	-$132.50
$106.76	-11.6%	-$132.50
$133.45	+10.6%	-$132.50
$160.14	+32.7%	-$132.50
$186.83	+54.8%	-$132.50
$213.52	+76.9%	-$132.50
$240.21	+99.0%	-$132.50

When traders use butterfly on TGT

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

TGT thesis for this butterfly

The market-implied 1-standard-deviation range for TGT extends from approximately $105.68 on the downside to $135.74 on the upside. A TGT long call butterfly is a pinning play: it pays maximum at the middle strike if TGT settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current TGT IV rank near 53.84% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on TGT should anchor more to the directional view and the expected-move geometry. As a Consumer Defensive name, TGT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to TGT-specific events.

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

Frequently asked questions

What is a butterfly on TGT?: A butterfly on TGT is the butterfly strategy applied to TGT (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 TGT stock trading near $120.71, the strikes shown on this page are snapped to the nearest listed TGT chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are TGT 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 TGT butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 43.44%), the computed maximum profit is $435.34 per contract and the computed maximum loss is -$132.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a TGT butterfly?: The breakeven for the TGT butterfly priced on this page is roughly $116.33 and $125.68 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 TGT market-implied 1-standard-deviation expected move is approximately 12.46%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a butterfly on TGT?: Butterflies on TGT are pinning bets - traders use them when they expect TGT 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 TGT implied volatility affect this butterfly?: TGT ATM IV is at 43.44% with IV rank near 53.84%, 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.