UTHR Butterfly Strategy
UTHR (United Therapeutics Corporation), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
United Therapeutics Corporation, a biotechnology company, engages in the development and commercialization of products to address the unmet medical needs of patients with chronic and life-threatening diseases in the United States and internationally. Its commercial therapies include Remodulin to treat patients with pulmonary arterial hypertension (PAH) to diminish symptoms associated with exercise; Tyvaso, an inhaled formulation of prostacyclin analogue treprostinil to enhance the exercise ability in PAH patients and pulmonary hypertension associated with interstitial lung disease (PH-ILD); Orenitram, a tablet dosage form of treprostinil to enhance the exercise capacity in PAH patients; Unituxin, a monoclonal antibody for treating high-risk neuroblastoma; and Adcirca, an oral PDE-5 inhibitor to enhance the exercise ability in PAH patients. The company also engages in developing Tyvaso DPI, a dry powder inhalation form of Tyvaso; Remunity Pump, a small, lightweight, durable pump and separate controller; RemoPro and Ralinepag for the treatment of PAH; Aurora-GT, a gene therapy product to rebuild the blood vessels in the lungs; and Tyvaso PERFECT and TETON studies, which are the studies of Tyvaso in patients with World Health Organization (WHO) Group 3 pulmonary hypertension associated with chronic obstructive pulmonary disease (PH-COPD). It has licensing and collaboration agreements with DEKA Research & Development Corp. to develop a semi-disposable system for the subcutaneous delivery of treprostinil; MannKind Corporation to develop and license treprostinil inhalation powder and the Dreamboat device; and Arena Pharmaceuticals, Inc. to develop Ralinepag. The company was incorporated in 1996 and is headquartered in Silver Spring, Maryland.
UTHR (United Therapeutics Corporation) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $24.60B, a trailing P/E of 19.58, a beta of 0.60 versus the broader market, a 52-week range of 272.12-609.35, average daily share volume of 559K, a public-listing history dating back to 1999, approximately 1K full-time employees. These structural characteristics shape how UTHR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.60 indicates UTHR has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.
What is a butterfly on UTHR?
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 UTHR snapshot
As of May 15, 2026, spot at $567.93, ATM IV 32.70%, IV rank 15.85%, expected move 9.37%. The butterfly on UTHR 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 UTHR specifically: UTHR IV at 32.70% is on the cheap side of its 1-year range, which favors premium-buying structures like a UTHR butterfly, with a market-implied 1-standard-deviation move of approximately 9.37% (roughly $53.24 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 UTHR expiries trade a higher absolute premium for lower per-day decay. Position sizing on UTHR should anchor to the underlying notional of $567.93 per share and to the trader's directional view on UTHR stock.
UTHR butterfly setup
The UTHR 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 UTHR near $567.93, the first option leg uses a $540.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed UTHR 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 UTHR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $540.00 | $41.05 |
| Sell 2 | Call | $570.00 | $23.05 |
| Buy 1 | Call | $600.00 | $10.10 |
UTHR butterfly risk and reward
- Net Premium / Debit
- -$505.00
- Max Profit (per contract)
- $2,416.11
- Max Loss (per contract)
- -$505.00
- Breakeven(s)
- $545.05, $594.95
- Risk / Reward Ratio
- 4.784
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.
UTHR butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on UTHR. 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% | -$505.00 |
| $125.58 | -77.9% | -$505.00 |
| $251.15 | -55.8% | -$505.00 |
| $376.72 | -33.7% | -$505.00 |
| $502.30 | -11.6% | -$505.00 |
| $627.87 | +10.6% | -$505.00 |
| $753.44 | +32.7% | -$505.00 |
| $879.01 | +54.8% | -$505.00 |
| $1,004.58 | +76.9% | -$505.00 |
| $1,130.15 | +99.0% | -$505.00 |
When traders use butterfly on UTHR
Butterflies on UTHR are pinning bets - traders use them when they expect UTHR 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.
UTHR thesis for this butterfly
The market-implied 1-standard-deviation range for UTHR extends from approximately $514.69 on the downside to $621.17 on the upside. A UTHR long call butterfly is a pinning play: it pays maximum at the middle strike if UTHR settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current UTHR IV rank near 15.85% 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 UTHR at 32.70%. As a Healthcare name, UTHR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to UTHR-specific events.
UTHR 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. UTHR positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move UTHR alongside the broader basket even when UTHR-specific fundamentals are unchanged. Always rebuild the position from current UTHR chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on UTHR?
- A butterfly on UTHR is the butterfly strategy applied to UTHR (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 UTHR stock trading near $567.93, the strikes shown on this page are snapped to the nearest listed UTHR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are UTHR 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 UTHR butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 32.70%), the computed maximum profit is $2,416.11 per contract and the computed maximum loss is -$505.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a UTHR butterfly?
- The breakeven for the UTHR butterfly priced on this page is roughly $545.05 and $594.95 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 UTHR market-implied 1-standard-deviation expected move is approximately 9.37%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on UTHR?
- Butterflies on UTHR are pinning bets - traders use them when they expect UTHR 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 UTHR implied volatility affect this butterfly?
- UTHR ATM IV is at 32.70% with IV rank near 15.85%, 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.