Call butterfly
Buy a lower call, sell two middle calls, buy an upper call (1:2:1). Cheap directional play that profits if the stock pins the middle strike at expiry.
INPUTS
Underlying price
$
Centers the payoff chart and computes P&L at this price.
LEGS
Long lower call
Type
Side
Strike
$
Qty
Premium
$
Short middle calls
Type
Side
Strike
$
Qty
Premium
$
Long upper call
Type
Side
Strike
$
Qty
Premium
$
RESULT
$60.003 strikes$140.00
P&L at current spot (expiry)
+$450
Net debit−$50
Max profit+$450
Max loss−$50
Breakevens$95.50 · $104.50
Risk / reward9.00 : 1
RISK PROFILE
Max profit
Wing width × 100 − net debit
Max loss
Net debit paid
Breakeven
Lower + (debit ÷ 100), Upper − (debit ÷ 100)
RELATED STRATEGIES
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