VIRC Butterfly Strategy
VIRC (Virco Mfg. Corporation), in the Consumer Cyclical sector, (Furnishings, Fixtures & Appliances industry), listed on NASDAQ.
Virco Mfg. Corporation (VIRC) is a leading designer, manufacturer, and distributor of furniture products throughout the United States. Its extensive portfolio includes a wide array of seating solutions, such as traditional four-legged and cantilever chairs, tablet armchairs (often with compact footprints), steel-frame rockers, various stools, and a selection of stackable, folding, ergonomic, upholstered, and hard plastic chairs. Beyond seating, Virco supplies a diverse range of tables for folding, activity, office, computer use, and mobile applications. The company also addresses specific technological needs with specialized computer furniture, featuring items like keyboard and mouse trays, CPU holders, support columns, desks, workstations, and instructor media stations. Its offerings further extend to integrated learning solutions like chair desks and combination units, alongside tablet arm and caster-equipped furnishings, and various returns and credenzas.
VIRC (Virco Mfg. Corporation) trades in the Consumer Cyclical sector, specifically Furnishings, Fixtures & Appliances, with a market capitalization of approximately $97.8M, a beta of 0.21 versus the broader market, a 52-week range of 5.16-9.09, average daily share volume of 69K, a public-listing history dating back to 1980, approximately 810 full-time employees. These structural characteristics shape how VIRC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.21 indicates VIRC has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. VIRC pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a butterfly on VIRC?
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 VIRC snapshot
As of June 30, 2026, spot at $6.12, ATM IV 94.40%, IV rank 43.61%, expected move 27.06%. The butterfly on VIRC 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 17-day expiry.
Why this butterfly structure on VIRC specifically: VIRC IV at 94.40% 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 27.06% (roughly $1.66 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated VIRC expiries trade a higher absolute premium for lower per-day decay. Position sizing on VIRC should anchor to the underlying notional of $6.12 per share and to the trader's directional view on VIRC stock.
VIRC butterfly setup
The VIRC 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 VIRC near $6.12, the first option leg uses a $5.81 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed VIRC chain at a 17-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 VIRC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $5.81 | N/A |
| Sell 2 | Call | $6.12 | N/A |
| Buy 1 | Call | $6.43 | N/A |
VIRC 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.
VIRC butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on VIRC. 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 VIRC
Butterflies on VIRC are pinning bets - traders use them when they expect VIRC 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.
VIRC thesis for this butterfly
The market-implied 1-standard-deviation range for VIRC extends from approximately $4.46 on the downside to $7.78 on the upside. A VIRC long call butterfly is a pinning play: it pays maximum at the middle strike if VIRC settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current VIRC IV rank near 43.61% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on VIRC should anchor more to the directional view and the expected-move geometry. As a Consumer Cyclical name, VIRC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to VIRC-specific events.
VIRC 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. VIRC positions also carry Consumer Cyclical sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move VIRC alongside the broader basket even when VIRC-specific fundamentals are unchanged. Always rebuild the position from current VIRC chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on VIRC?
- A butterfly on VIRC is the butterfly strategy applied to VIRC (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 VIRC stock trading near $6.12, the strikes shown on this page are snapped to the nearest listed VIRC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are VIRC 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 VIRC butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 94.40%), 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 VIRC butterfly?
- The breakeven for the VIRC 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 VIRC market-implied 1-standard-deviation expected move is approximately 27.06%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on VIRC?
- Butterflies on VIRC are pinning bets - traders use them when they expect VIRC 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 VIRC implied volatility affect this butterfly?
- VIRC ATM IV is at 94.40% with IV rank near 43.61%, 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.