LD Lossdog Research
strategy

Butterfly spread

2 matching records.

Trade idea

Trade idea Butterfly spread

Taking $2 of profit and having a free butterfly that could go to $1,000

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StrategyButterfly spread
Entry / triggerIf the stock is in a range and IVR is on the low end of the range
Target / exitProfit from a free butterfly that could go to $1,000
SpeakerUnknown
Butterfly spread
high confidenceVerify in video at 1:19:28 ↗
Trade idea

SPACEX Butterfly spread

The speaker suggests that a butterfly spread on SpaceX could be constructed with an expected move of $42. The strategy involves setting the width of the strikes based on the expected move, with the put side being adjusted more aggressively if the trader is bullish. The speaker also notes that the volatility in SpaceX is still relatively high, making the butterfly spread potentially more expensive. The thesis is based on the expected move and the volatility levels, with the potential for profit if the stock moves within the expected range.

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StrategyButterfly spread
Assetequity
ExpirationAugust
Time horizonShort-term
Entry / triggerExpected move of $42
Target / exit42 higher
Invalidation / stopIf the expected move is not realized
SpeakerScott
Structure / legs
  • put
  • call
Risks
  • Volatility could lead to higher costs
  • The expected move may not materialize
  • Liquidity issues in the options market
bullishequitybullishButterfly spreadshort-term
medium confidenceVerify in video at 44:20 ↗