Expiration is only 10 days away for May. With Volatility high and market going up drastic today, we are going to look for a cheap option strategy for the market to go back down.
Due to volatility, we are going to choose a butterfly option on the spx. This is low probability but the reward/risk is extremely high.
See below for the option trade. This butterfly is going to cost us 0.25/butterfly. The reward is huge we have to have the SPX close between 1130 and 1140 at expiration.
For EDUCATIONAL USE. Commodity Futures Trading Comission, Forex, Futures, Equity and options trading has large potential rewards, but also large potential risk and may not be suitable for everyone. You must be aware of the risks and be willing to accept them in order to invest in these markets. Do not trade with money you can not afford to lose. This is neither a solicitation nor an offer to Buy/Sell. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this document. The past performance of any trading system or methodology is not necessarily indicative of future results. All information provide d on the Blog is for educational purpose