Trading Like A Pro: The Wide Butterfly Spread Technique

An old floor trader trick, and Tom Preston says up front it is not a beginner topic. Any butterfly with more than one strike increment between the wings and the body is not really one trade. It contains several narrower butterflies, and there is a simple way to count them. Count the steps between the strikes and square it. That is how many one step butterflies sit inside. As the index moves, whichever embedded butterfly is closest to its own centre is worth the most, and it can be closed on its own. Education, not a recommendation. 📊 tastylive: https://www.tastylive.com/ 📰 Get Tom's pre-market analysis every morning: https://www.tastylive.com/newsletters 📘 FREE Options Strategy Guide: https://tinyurl.com/bp9ms763 📱 Follow tastylive on X: https://x.com/tastyliveshow Chapters 0:00 What a butterfly does 0:33 An old floor trader trick 1:22 Breaking one into four 2:36 Adding up the rows 3:47 What this actually means 4:28 The math for counting them 5:13 Why you would need this 6:17 Working through a live chain 7:02 Harvesting the maximum value 8:02 Comparing what each is worth 8:57 How he actually uses it 9:48 What to do next 10:23 A note on risk #tastylive #butterflyspread #optionstrading #0dte #spx #optionsstrategy #cherrybomb #optionseducation #tastytrade #trading tastylive is a real financial network, producing hours of live programming every day. Follow along as our experts navigate the markets, provide actionable trading insights, and teach you how to trade. With over 120 original segments, and over 25 personalities, we'll help you take your trading to the next level, whether you are new to trading or a seasoned veteran. tastylive content is created, produced, and provided solely by tastylive, Inc. ("tastylive") and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involve risk and may result in a loss greater than the original amount invested. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. Options, futures, and futures options are not suitable for all investors. Prior to trading securities, options, futures, or futures options, please read all applicable risk disclosures, including, but not limited to, the Characteristics and Risks of Standardized Options Disclosure and the Futures and Exchange Traded Options Risk Disclosure Statement found at https://tastytrade.com/disclosures/. Past performance is not indicative of future results. Performance is not presented net of all commissions, fees, and expenses. Multi-leg option strategies incur higher transaction costs than single leg trades as they involve multiple commission charges. Examples provided are for illustrative, informational, and educational purposes only and are not intended to be reflective of results you can expect to achieve. Supporting documentation for any claims, including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request. tastylive, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. tastylive is not a licensed financial adviser, registered investment adviser, or a registered broker-dealer.