Long Butterfly Spread

Neutral Outlook & High Volatility Directional Assumption:  Neutral Setup: This spread is typically created using a ratio of 1-2-1 (1 ITM option, 2 ATM options, 1 OTM option).– Buy Call/Put (above short strike)– Sell 2 Calls/Puts– Buy Call/Put (below short strike) A long butterfly spread is a neutral position that’s Read more…

Front Ratio Put Spread

Neutral to Slightly Bearish Outlook & High Volatility Directional Assumption:  Neutral to Slightly Bearish Setup: – Buy an ATM or OTM put option– Sell two further OTM put options at a lower strike Timeline: 45 days Ideal Implied Volatility Environment:  50% or greater. Profit Target: 25% – 50% of the Read more…