Long Butterfly Options Strategy (Best Guide w/ Examples)

Your graphs with P/L are great.

Hi, only long call butterfly example, no long put butterfly example? What is the scenario of long put butterfly stradegy? is it also predicting stock price moving in a certain range?

Bet you never used this strateg in real life

hi can i get the pdf of the strategy and all strategy which you have shown presentation . also i want the most common strategy which we need to master i am indian stock market and can you guide me which strategy shall i master

Is this to be done in low IV or high IV environments?

So Chris how long have you been studying options trading for? Also very interested in the steps you took to get so damn good! Great vid man I always learn a ton from you!

You are the best teacher ever. Finnaly I understand this baby. Thank you so much!!!!!

Is the butterfly a hedge, speculation, or arbitrage? (I’m almost certain it is not speculation)

Solid video as always. Thanks for breaking it down. I think I may need to watch it about 25 more times....but I do have a better understanding of this strategy. Aloha!

Thank you for sharing very detail and helping me to understand much more about butterfly.

Great video, I was wondering where did you make those P/L graphs? They are clean.

Hello Chris, can you please explain how we are getting the break even of $322.94.What's the logic behind it. Kindly reply..!!

Dude you are the absolute G.O.A.T. Your explanations are on point. Thanks a lot.

In my actual experience, the position was just above the left leg enough to generate a decent profit (lower leg) from the fly but I just didn't know how to handle it upon expiration and left the trade, sadly. What if in the after-hours the stock moves ITM of the short? I have been trying to find detailed information for butterflies because they're complex compared to other types but haven't had much luck on detailed scenarios around expiration and how to handle the situation during the last day of the contract before it expires. e.g. which way is less risky, avoids shares, (short or long), and provides a decent profit? I see you briefly touched it at the final bullet in the end but would love more details of scenarios here. What actions might one take are the key elements I'm not seeing described in tutorials, please explain or make something options geeks :-) As a new options trader, I don't understand what is the best course of action when it's actually ITM of either the left or right side before (intraday of expiration), right at close, and after-hours before expiration. I've heard of buying shares to cover (same for short as well) and all kinds of things but not seen any example of each scenario for winning flys to get a better idea of how people deal with this to avoid losing capital. I know I need to be aware of the situations and am well educated and aware but I'm not educated in how to handle it yet :-/

im still kinda confused, when buying a long butterfly spread are you hoping for the stock price to go down?

Hey, for the "Example of a Put Butterfly" early in the video, shouldn't it be Long 100/105 Put Spread and Short 105/110 Put Spread? Thanks

So it’s like a box chart basically

Can I be profitable before the expiration?

You say the butterfly spread involves selling two calls, so do you need to already own them?

You you first started the butterfly spread why is it when you start on the position and the price is almost exactly in the max profit range is it not worth the max profit?

Wow i hated calculus

May i suggest the following. Go check the real prices on options of any company and see if you can make it work even theoretically. Chances are (99.9999%) every single time you purchase low and high strike options price paid would be higher than the price at which you can sell the middle ones. So, in real life, even the opportunity to try with profit is not. No disrespect to the author, perfect explanation, but it is just a theoretical work that does not exist nowdays.

Are we need to wait the option to expired to get a max profit for long call butterfly ?

that was a great explanation man

Project Finance is the only hope we have in defeating BOGANDOFF

Hello,
Great explanation of this strategy. I'm looking to try it out soon on a weekly basis using calls for the stock AT&T Inc., since based on my understanding it is a pretty rangebound stock that is likely to remain close to its current market price. One of the things I was curious about was the actual execution of the strategy, in particular assignment risk. Is it best managed by closing out the position early whenever the underlying price is trading near the short strike?

Thanks,
Abhi

For the long call butterfly spread example, are you at risk of getting assigned shares is price closes above 300, but below 350?

Is there a risk of an early assignment? Or just at the expiration?

what are the difference between a bufferly like this that centres around the ATM price, vs one that straddles a out of money strike, this seems like non-directional bufferfly

Hello Chris, do you think we should take a look at the current skew regarding whether to go with a Put or a Call butterfly? I mean if the skew benefits the Put options, for example, we may have better prices for that.

Fantastic!!! Answered all my questions!!! 😄