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Option Trading Strategy: Setup a Butterfly Spread

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Option Trading Strategy: Setup a Butterfly Spread ★ SUMMARY ★ Hey it’s Sasha Evdakov founder of Rise2Learn. In this video I want to share with you exactly behind What the Butterfly is when it comes to Trading Options and why you may want to trade the Butterfly. The Butterfly’s just a fancy name for a type of spread because it looks like a butterfly. You can trade a butterfly to the upside you can't really tell downside or you can trade it to collect option premium butterfly’s a very effective strategy because it uses a lot less margin and which means a lot less risk to be able to trade those larger dollar value stocks. First I want to share with you exactly what the butterfly is and what it looks like on a regular diagram and then I want to show you in the trading program and how to set up the butterfly. Posted at: http://tradersfly.com/2014/05/option-trading-strategy-setup-butterfly-spread/ ★ SHARE THIS VIDEO ★ https://youtu.be/YemFOAfsZ8Y ★ SUBSCRIBE TO MY YOUTUBE: ★ http://bit.ly/addtradersfly ★ ABOUT TRADERSFLY ★ TradersFly is a place where I enjoy sharing my knowledge and experience about the stock market, trading, and investing. Stock trading can be a brutal industry especially if you are new. Watch my free educational training videos to avoid making large mistakes and to just continue to get better. Stock trading and investing is a long journey - it doesn't happen overnight. If you are interested to share some insight or contribute to the community we'd love to have you subscribe and join us! FREE 15 DAY TRIAL TO THE CRITICAL CHARTS -- http://bit.ly/charts15 GET THE NEWSLETTER -- http://bit.ly/stocknewsletter STOCK TRADING COURSES: -- http://tradersfly.com/courses/ STOCK TRADING BOOKS: -- http://tradersfly.com/books/ WEBSITES: -- http://rise2learn.com -- http://criticalcharts.com -- http://investinghelpdesk.com -- http://tradersfly.com -- http://backstageincome.com -- http://sashaevdakov.com SOCIAL MEDIA: -- http://twitter.com/criticalcharts/ -- http://facebook.com/criticalcharts/ MY YOUTUBE CHANNELS: -- TradersFly: http://bit.ly/tradersfly -- BackstageIncome: http://bit.ly/backstageincome
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Text Comments (47)
Ronde Fabian (4 days ago)
Earning profit in future trading, you need to measure from the support line to the mid-peak or break line. Then take this measurement and repeat it up starting from the penetration level. To learn how to do this concept I recommend you use and learn Blended Model strategy created by Dmitry vladislav. it give a knowledgeable and good profit returns.
Be Balance (1 month ago)
So good
thank you so much for watching
K R (1 month ago)
Which software are you using?
Ronde Fabian (4 days ago)
Earning profit in future trading, you need to measure from the support line to the mid-peak or break line. Then take this measurement and repeat it up starting from the penetration level. To learn how to do this concept I recommend you use and learn Blended Model strategy created by Dmitry vladislav. it give a knowledgeable and good profit returns.
TC2000 and thinkorswim - check the resources page here: https://tradersfly.com/resources/
steeleyes (4 months ago)
Asymmetric trading....????
mybetterfilms (9 months ago)
Dude I'm happy with $100-$300 per day or even a week and this should help right?
Peter Dylan (1 year ago)
get to the point
SPAce the Spa (1 year ago)
Awesomely explained. Thanks much, Sasha. Do you have a video on reverse butterfly spread?
AMOL GAWANDE (1 year ago)
if I have credit spread and now trade turns  against me i.e sold CE 1 lot @ 150 premium & brought higher price CE @ 100 premium , now on expiry I will hv losses if it closes against me, in this situation can I convert the trade where at least  I can get my money back by converting the same trade into butterfly ?
meme youyou (1 year ago)
Hi great video. If a have a sold a vertical credit spread and it went ITM, can i convert that to butterfly? Thanks!
Yat Suen (1 year ago)
hi Sasha, excellent video, wondering what trading software it is in your video?
Sindy Fernandez (1 year ago)
Great video Sasha, Im starting out to learn Option, will spend most of my day today watching your videos.. Thanks for sharing..
WhYsO SeRiOuSe (1 year ago)
WhYsO SeRiOuSe (1 year ago)
hello...(: what broker and website did u use in that video?thanks
The-oneN-Only (1 year ago)
Sasha Evdakov hello great video can you explain the channel trending more for beginners little bit more basic thank you very much !!
WhYsO SeRiOuSe (1 year ago)
I have a question (:. what broker/website were you in that video?
Gaurav Solanky (2 years ago)
Hi Sasha, thanks for your informative videos. I have a question for you, I am trying to apply same Butterfly strategy to Swaption. Now, as per my understanding rate at the expiration of contract will behave same as strike price in Option. Can you please confirm if I am on the right track, if not please correct me. Regards, Gaurav
Yat Suen (1 year ago)
yes, all floating rates canceled out, left with the fixed short and longs, the profit that you make is the netting fixed rate cash flows less your option cost
Gaurav Solanky (1 year ago)
sorry for not putting it in best way. I am trying to apply Butterfly strategy on Swaption, buying one call Swaption with low rate(lets say 5),Selling two Call Swaption @ fixed rate 5.50% and buying one call Swaption @6%. Now, in this case strike rate would be rate at the time of expiration i.e. floating and will behave in the same way the strike price behaves. so, the pay off will be based on spread and premium you pay for Swaption. Am I correct ?
Lincoln C Mitchell (2 years ago)
We are a big fan of Sasha, we have seen most of all his videos
terence wang (2 years ago)
Hi, Sasha, i have a question. lets assume the current price for apple is $100. with the butterfly spread strategy, you sell 2 call option at strike price @$100, and buy 1 at $90 and $110 respectively. my concern is, 1. if the stock price go beyond $110, there is only 1 call option @$110 to cover the loss. 2. why set up a call option at $90 strike price? How is it protect the account from losing money. Thanks in advance
foki Farooq (2 years ago)
another great video sasha thank you. few question 1) why do we get a credit when trading Iron butterflies? is the credit received from iron butterflies is better then the debit paid for it? thank you for your great work, keep the tutorials coming
John Morrison (2 years ago)
Durrell Harley (2 years ago)
Great Video! I learned something new today.
Tuk Dasdo (2 years ago)
you speak very well and not too fast
kdisd5 512 (8 months ago)
*ToDay $1550* t.co/6walqWJIRT
Kurtie7 (3 years ago)
Thank you, Sasha...I'm learning tons....you certainly know what you're doing! I'm starting out...and,..I'm going to your website to see what's happening!
ec simo (2 years ago)
+Kurtie7 If you is interested in how to cash in on foreign exchange markets easily the greatest info that i've had was by using the Magic Monitor Blueprint (search google) without a doubt the most incredible site i've followed.
Kurtie7 (3 years ago)
+Sasha Evdakov Yes,.....Just taking a look------wow.....I'll keep you updated !!... Thank you..
Perri Magnezi (3 years ago)
Sasha, after watching many option trading videos on you tube some of them on butterfly strategy your is probably one  of the best; however, I could not find an answer to my question how far from the stock price would you want to put the short strike price?  Is it one SD, 1/2 SD? what about the wings? how  far it would make sense to put the break even points given the IV? what is your rule of thumb if I may ask. Regards, follower
Steve Kaldi (3 years ago)
Steve Kaldi (3 years ago)
Steve Kaldi (3 years ago)
Excellent video
TheFOREXgroupLLC (3 years ago)
Do you have a facebook?
kingmike40 (3 years ago)
The types of people with big enough accounts to do these trades are not the type of people who have to use youtube to learn how.
Saeed Alkhulaidi (3 years ago)
great instruction and Videos thanks Sasha subbed  can you talk about the probability for options in TOS
Yash S (3 years ago)
Great videos subbed
David W. Johnson (4 years ago)
Never cared for Butterflies.................Iron Condors are better
Tim Warren (4 years ago)
Awesome Video!!
TheTraveler (4 years ago)
I saw the share price was at $604 at the beginning? how come at 10:15 none of these options were ITM or ATM for the butterfly spread? don't you have to Buy 1 ITM Call, Sell 2 ATM Calls, Buy 1 OTM Call?
TheTraveler (4 years ago)
+Sasha Evdakov I see, thanks for replying!
mycombs (4 years ago)
What software are you using in this video, and can a regular person access it?
Glenn S. Marks (4 years ago)
Very impressive video... 
Glenn S. Marks (4 years ago)
I haven't seen any video where I can get information/clarification against every step. If I have to rank down the best videos of binary options you are gonna be second best after http://expertoptiontrading.com/oi/ . They are also describing each and every step for every possible outcome. Honestly, you people are doing great work. Thumbs up. 
Salvador Luna (4 years ago)
vega? delta? i'm lost

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