How to Expand the Profit Zone on Butterfly Trades

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  • Опубліковано 27 сер 2019
  • Register for our free intensive trading webinar smbu.com/seth
    The most popular options strategy on SMB's options trading desk is the butterfly. In this video, we walk you carefully through a professional adjustment that is used to extend the profit range of a butterfly and have plenty of profit remaining in the trade, expanding your chances for a win significantly.
    #smbcapital #stockmarket #daytrading
    SMB Disclosures www.smbtraining.com/blog/smb-...

КОМЕНТАРІ • 38

  • @gregdolley9189
    @gregdolley9189 4 роки тому +11

    Seth - that slide at 6:15 has a huge copy/paste error. Looks like it was copied from the broken wing butterfly video and numbers modified, but the description on each row is clearly wrong. Looks like it wasn't updated after pasting.

  • @InfiniteQuest86
    @InfiniteQuest86 4 роки тому +13

    @ 6:20 slides do not match the setup seen in the trading window.

  • @mem4730
    @mem4730 Рік тому +5

    the slide at 6:15 does not match the trades in the matrix, But otherwise well presented, thanks

  • @MartinMartinez-vx8qw
    @MartinMartinez-vx8qw 3 роки тому +17

    I really feel like slapping myself for not realizing that I could have been trading iron butterflies and just converting them over to iron condors when they turn sour.

    • @figh761
      @figh761 16 днів тому

      Are you making good money

  • @brucedennis3509
    @brucedennis3509 3 роки тому +3

    I really like the options videos and have been very well done and helpful. Never really thought about making an adjustment by putting on a fly within an existing fly trade. Very nice.

  • @InvestingMadeEasy2023
    @InvestingMadeEasy2023 Рік тому +4

    Thank you for the interesting video. It is an interesting way to adjust an iron butterfly. However, what you did not explain is that after adjustment your risk increases should the share price continue to go up and go well above the $2,825 in this example. At the start your spread is $100 and you get $66.23 in premium per share so your risk per share was $100 - $66.23 = $33.77 so $3377 in total. After the adjustment your spread is still $100 but now you reduced your premiums from $66.23 to $14.84. Your new risk per share is then $100 - $14.84 = $85.16 so $8516 in total. That is a significant risk increase. That is fine and it is still an interesting repair strategy but am I correct that it increases the risk or am I missing something?

  • @edwardolivares4103
    @edwardolivares4103 4 роки тому +4

    Love these videos but why do the strikes show 100 points wide then 25 points wide?

  • @zeyadb6433
    @zeyadb6433 3 роки тому

    Very informative. Would you be able to do the same, a put side butterfly, if the trade went sour in the other direction?

  • @e.b.soptions3298
    @e.b.soptions3298 3 роки тому

    Hey, what kind of stocks are Iron Butterfly suitable for before reports?

  • @scottmusick3252
    @scottmusick3252 Місяць тому

    Seth, I’m curious how much did the capital requirement increase when you applied the adjustment to Iron Condor. Thank you!!!

  • @viviane.4455
    @viviane.4455 2 роки тому

    Very NICE VIDEO AND INFORMATIVE. Reduced the overwhelming feeling of Butterfly trade set-up. Need to w as tech the video a couple more times to be very comfortable we with the set-up.

  • @3X0SK3L3TON
    @3X0SK3L3TON 2 роки тому

    I never thought that a butterfly can be rerolled and become an iron condor. Great video

  • @Berelore
    @Berelore Рік тому +2

    Why not roll up the untested put side for increased credit?

    • @brianquigley6862
      @brianquigley6862 9 місяців тому

      I agree with you. I got a bit confused on this adjustment. I would have explained it differently and show the new position graphically. In an IC when adjusting I take profits on the winning side (locked in profits). Then roll the winning side closer to get more premium, thus less risk. Name of the game when wrong is to lose less, NOT necessarily win.

  • @bibarishs3120
    @bibarishs3120 3 роки тому +1

    Thank you sir

  • @JoeT876
    @JoeT876 3 роки тому +5

    I love these videos! I would like to hear about why someone would choose a butterfly vs an Iron butterfly. Thanks

    • @lj4001
      @lj4001 2 роки тому

      If I’m not mistaken, any “Iron” before a strategy it’s mostly PUTs oriented.
      But I would like to be corrected as I’m new in option trading and unsure if this is fact.

  • @analogman9697
    @analogman9697 2 роки тому

    I have a trade of this type in NIO that I will apply this strategy tomorrow. Thanks. Also, if you could share some 'dos and don'ts' relative to managing/mismanaging winners, that would be great. I've screwed myself royally a few times and I can only assume there may be more on the horizon lol.

  • @dek2000utube
    @dek2000utube 4 роки тому +1

    Oustanding!

  • @nathanielwilliams6154
    @nathanielwilliams6154 Рік тому

    Explain the diagonal and calender spreads please

  • @tjadd5454
    @tjadd5454 4 роки тому +2

    Hi. Have you heard of the reverse Harvey adjustment strategy for iron butterflies...I think it's better than what your suggesting

  • @TheLordtaiko
    @TheLordtaiko 3 роки тому

    Could you just buy back the short and sell a higher short turning it into a debit spread cheaper?

  • @douglasteachout1958
    @douglasteachout1958 10 місяців тому

    What is the DTE of the original trade?

  • @charlierobles316
    @charlierobles316 3 роки тому

    What about a reverse butterfly?

  • @tukularwano4272
    @tukularwano4272 2 роки тому +1

    What happens if SPX closes at 2925?

  • @yougosquishnow
    @yougosquishnow 4 роки тому +1

    Aren't index options European style?

  • @mad0316
    @mad0316 7 місяців тому

    Excellent video Seth! Is it correct that the correction to the Iron Butterfly results in new breakeven prices for the trade?

  • @insurancecasino5790
    @insurancecasino5790 4 роки тому

    When it come to options always show the price charts. Why? You don't have to think about the trade when explaining it or getting it explained to you. example: pbs.twimg.com/media/EDfjPxdVUAEL5jh.png

  • @gsheppard2729
    @gsheppard2729 2 роки тому +1

    Great content. How about videos about growing small accounts. Thks .

  • @prebenebbesen5547
    @prebenebbesen5547 Рік тому

    Why did you pick 2825 as adjustment? Your videos are very interesting but I can visualize more clearly if you show the risk graph, and explain if the delta of 2825 had anything to do with your decision. Also, do you guys really go to expiration on all of your trades? I find that somewhat confusing.

  • @garygraham4679
    @garygraham4679 4 роки тому +6

    That was the sorriest thing I ever saw from someone trying to sell a "system". Numbers don't jibe, screens don't match up, nothing but razzle dazzle!

    • @bigkeno
      @bigkeno 4 роки тому +2

      The screen might be off but the trade is solid.

    • @scarfo441
      @scarfo441 2 роки тому

      And to think that after 2 years they would have got it right,but no..and they want me to attend their "free"seminar..they must've went out if business..

  • @quicksolutions1233
    @quicksolutions1233 2 роки тому +3

    Numbers all mixed up - anyone paying attention here??? SMB get your numbers right plz - great strategy messed up by poor presentation

  • @marksibert305
    @marksibert305 Рік тому

    I definitely need a cheaper company to play this game. WOW!!!

  • @garygraham4679
    @garygraham4679 4 роки тому +2

    Useless!!!! Math is utter gibberish! But thanks for playing.