HOOD Iron Butterfly — May 15, 2026

HOOD (Robinhood Markets Inc Class A) presents a iron butterfly opportunity with elevated implied volatility. IV Rank 60. IV 5529.0% trades 180.0pp above 30-day HV (5349.0%). This setup favors net premium sellers.

Sell the $70 ATM put and the $70 ATM call simultaneously (both at the same strike near the underlying), with long wings further out for defined risk. Higher max profit than a condor but a tighter profit window — ideal when you expect a stalling move into expiration. Underlying ~$69.19, 19 DTE. Max profit $430 per contract, max loss $71, 609.2% return on risk, 11% POP. Breakevens at $65.70 and $74.30.

Management: take profit at ~50% of max profit ($215). Cut at 2x credit ($859 loss). If short strike is breached with > 14 DTE, consider rolling out for a credit. Close before expiration week to avoid gamma risk.

Underlying: HOOD @ ~$83.95 Expiration: May 15, 2026 (19 DTE) Legs:

• Sell HOOD May 15, 2026 $70 Put (delta -0.13, mid $1.22)
• Buy HOOD May 15, 2026 $65 Put (delta -0.08, mid $0.62)
• Sell HOOD May 15, 2026 $70 Call (delta 0.88, mid $15.78)
• Buy HOOD May 15, 2026 $75 Call (delta 0.77, mid $12.07)

Use limit orders at the mid or slightly worse. Verify bid-ask spread (currently ~5.4% of mid) before sending.

Take profit at 50% of max profit ($215). Cut loss if position reaches 2x credit received ($859 loss). Roll if tested with > 14 DTE remaining.