Long Call Butterfly
You think that by a specific date price will land around a certain level. You cheaply bet on "freeze right here": nail the level and you get max profit, miss it and you only lose the small entry cost.
How the Long Call Butterfly works
Max profit is if price closes at the center strike; on the edges you lose only the debit paid. It is cheap with a high reward/risk ratio, but needs an accurate landing.
Placing strikes at GEX levels
Put the center at Max Pain or a large GEX magnet price gravitates to; the wings at neighboring levels. The ideal regime is positive GEX and an expected pin into expiry.
Max Pain and the GEX levels are computed live in the GEX Terminal — build the butterfly in the Position Builder.
When to open, the Greeks and managing the position
Open it when stability and low volatility are forecast and you want to pinpoint the central strike by a set date. Max profit = (wing width − debit) at the centre; breakevens: lower strike + debit and upper strike − debit.
Greeks: positive theta near the centre (time works for you) and negative vega. Management: expiration risk is high — price exactly at the body creates assignment uncertainty on the short options, so the position is often closed before expiry.
FAQ
Selling the two center calls funds the wings, so the net debit is small.
If price closes at the center strike at expiry.
Build the Long Call Butterfly on live BTC and ETH quotes in the Position Builder.
Open the Position BuilderRelated strategies
Information is for educational purposes only and does not constitute investment advice. Options trading carries high risk.