SPY weekly butterflies

Discussion in 'Options' started by JJacksET4, Dec 15, 2011.

  1. I've been doing some of these recently, even opening them halfway though the week and I've been impressed with how well they tend to work. Admittedly, just like with just about anything, they can go 100% wrong in a huge gap move or whatever, but otherwise they seem pretty good.

    On 11/22, I did a qty of 3 point butterflies 116/119/122 for $110 debit. On 11/23, the market fell quite badly, to the 116s and I was still able to close them for $120 credit - I didn't hold for Friday because it was near the bottom range and I didn't want to risk a gap. I was pretty surprised that I had done butterflies and with a fairly good sized down move, I actually made a few bucks.

    Yesterday, I did a qty of 2 point butterflies 120/122/124 for $76 debit. Today I was able to close for $110 credit. Even when SPY was over $123, they were still around $75-85, so it would have been no real loss.

    The other nice thing is other then a quick, large move, they seem to tend to slowly but surely move upwards. This morning, I was looking at $80-$85 to close, then $90-$95, then $100, and eventually I got the $110 - now I look and its $115-$125 range.

    Anyone else do 1-2-3 day SPY butterflies?

  2. ...what is some of your thinking going into the fly trade, ie, puts. calls, long, short, iron fly? i haven't traded any flys, but have talked with other traders who have been trading weekly short flys.....

  3. I think that the current market is not for butterflies, it makes sense to trade weekly calendar spreads