Iron Butterfly Spread - Components
Buy To Open X number of Out Of The Money Call Options. 2. Sell To Open X number of At The Money Call Options. 3. Buy To Open X number of Out Of The Money Put Options. 4. Sell To Open X number of At The Money Put Options.
Buy OTM Call + Sell ATM Call + Buy OTM Put + Sell ATM Put
Iron Butterfly Spread - Expectation
Stagnant
Iron Butterfly Spread - Risk / Reward
Maximum Profit: Limited
Maximum Loss: Limited
Iron Butterfly Spread - Breakeven Point
Upper Break Even Point = Short Call Strike + Net Credit
Lower Break Even = Short Put Strike - Net Credit
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