Butterfly Option Spreads
Like Duolingo, but for Butterfly Option Spreads. Tomo turns the whole topic into a game you play five minutes a day, until it actually sticks.
For the part of you with thirty open tabs that never became anything.
A short one: 11 levels across 2 sections, about 22 minutes end to end, roughly 4 days at five minutes a day. It moves through Building the Spread and Executing and Adapting. It assumes you already know the basics.
Free forever · No credit card · iPhone & Android
Key ideas in Butterfly Option Spreads
- A long butterfly merges a bull call spread and a bear call spread sharing middle strikes.
- Selling two center options caps the lower spread and finances the upper protective wing.
- Total risk is strictly limited to the initial net debit paid to enter all four legs.
- The two short strikes form the body, which dictates where peak profit concentrates at expiration.
- Every dollar the underlying settles away from the short strike body reduces payout toward zero.
- Pinning the stock right at the short strikes lets both short options expire completely worthless.
- Maximum profit is the wing width minus the net debit, yielding very high reward-to-risk ratios.
- A tiny net debit creates asymmetric upside but demands pinpoint accuracy on the settlement price.
- Standard vertical spreads cost more debit but only require the stock to clear a single boundary.
- Put-call parity guarantees that identical-strike call and put butterflies share the exact same payout curve.
- Traders choose between calls or puts based on bid-ask spreads and open interest rather than directional bias.
- Both call and put butterflies trade for a net debit when assembled with standard equidistant wings.
- Wider wings broaden the breakeven range so price can wander further
- Expanding wing distance demands higher upfront net debit capital
- Wider setups risk more total dollars if the stock blows past the wings
- A long butterfly has net negative vega because it is short two center options
You've tried the other tabs
Thirty open tabs. Four facts you actually kept.
You watched. You nodded. By Sunday it was gone.
One answer, then back to scrolling.
Eight weeks. You meant to finish. You didn't.
Tomo gives Butterfly Option Spreads the Duolingo treatment: levels, streaks, and quick quizzes that test what you just learned. That game loop is what the tabs above never had, so it's the one you actually finish.
Here's what playing it feels like
A real question from this course. Take your best guess.
What two standard spreads come together at a shared center to build a long butterfly?
Get it right to open this lesson and 10 more in the app.
Where Butterfly Option Spreads takes you
Construct, price, and manage butterfly option spreads to target specific price ranges with capped downside. Balance risk with precise wing widths and adapt structures with broken-wing variations.
- 1
Building the Spread
- Assembling the Standard Butterfly
- Calibrating Strikes and Greeks
- 2
Executing and Adapting
- Managing Exits and Expiration Risk
- Deploying Broken Wing and Iron Variations
2 sections · 4 units · 11 levels. Built to play, not to enroll.
You pick the voice
Butterfly Option Spreads is taught in the The Bestie style: your friend who just gets it. Want a different feel? In the app you can spin up the same topic in any of Tomo's teaching styles. Same facts, totally different vibe.
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Start Butterfly Option Spreads today.
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