Options Glossary

Glossary: Butterfly Spread

Last Updated: July 12, 2015

Glossary

Butterfly Spread

What Does Butterfly Spread Mean in Options Trading?

A strategy of combining bull and bear credit spreads to minimize the risk with the short option of each spread on a single strike price. The profit is also limited due to the increased probability of the trade to profit. Put's or calls can be used for this strategy.

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