WRAP Butterfly Strategy
WRAP (Wrap Technologies, Inc.), in the Technology sector, (Hardware, Equipment & Parts industry), listed on NASDAQ.
Wrap Technologies, Inc., a public safety technology and services company, develops policing solutions to law enforcement and security personnel. The company develops BolaWrap 150, a hand-held remote restraint device that discharges a Kevlar cord to restrain noncompliant individuals from a range of 10-25 feet. It operates in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company was founded in 2016 and is based in Tempe, Arizona.
WRAP (Wrap Technologies, Inc.) trades in the Technology sector, specifically Hardware, Equipment & Parts, with a market capitalization of approximately $79.9M, a beta of 1.41 versus the broader market, a 52-week range of 1.2-3.23, average daily share volume of 313K, a public-listing history dating back to 2018, approximately 19 full-time employees. These structural characteristics shape how WRAP stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.41 indicates WRAP has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a butterfly on WRAP?
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 WRAP snapshot
As of May 15, 2026, spot at $1.48, ATM IV 124.90%, IV rank 31.59%, expected move 35.81%. The butterfly on WRAP 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 WRAP specifically: WRAP IV at 124.90% 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 35.81% (roughly $0.53 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 WRAP expiries trade a higher absolute premium for lower per-day decay. Position sizing on WRAP should anchor to the underlying notional of $1.48 per share and to the trader's directional view on WRAP stock.
WRAP butterfly setup
The WRAP 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 WRAP near $1.48, the first option leg uses a $1.41 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed WRAP 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 WRAP shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $1.41 | N/A |
| Sell 2 | Call | $1.48 | N/A |
| Buy 1 | Call | $1.55 | N/A |
WRAP 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.
WRAP butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on WRAP. 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 WRAP
Butterflies on WRAP are pinning bets - traders use them when they expect WRAP 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.
WRAP thesis for this butterfly
The market-implied 1-standard-deviation range for WRAP extends from approximately $0.95 on the downside to $2.01 on the upside. A WRAP long call butterfly is a pinning play: it pays maximum at the middle strike if WRAP settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current WRAP IV rank near 31.59% is mid-range against its 1-year distribution, so the IV signal is neutral; the butterfly thesis on WRAP should anchor more to the directional view and the expected-move geometry. As a Technology name, WRAP options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to WRAP-specific events.
WRAP 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. WRAP positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move WRAP alongside the broader basket even when WRAP-specific fundamentals are unchanged. Always rebuild the position from current WRAP chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on WRAP?
- A butterfly on WRAP is the butterfly strategy applied to WRAP (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 WRAP stock trading near $1.48, the strikes shown on this page are snapped to the nearest listed WRAP chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are WRAP 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 WRAP butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 124.90%), 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 WRAP butterfly?
- The breakeven for the WRAP 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 WRAP market-implied 1-standard-deviation expected move is approximately 35.81%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on WRAP?
- Butterflies on WRAP are pinning bets - traders use them when they expect WRAP 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 WRAP implied volatility affect this butterfly?
- WRAP ATM IV is at 124.90% with IV rank near 31.59%, 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.