OptionAutomator Options Trading Glossary:

Definition, Examples & Resources:Broken Wing Butterfly Spread'

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What is Broken Wing Butterfly Spread in Options Trading ?

Broken Wing Butterfly Spread
A type of butterfly spread which is skewed to create reward in a single direction within a current range and has risk if the underlying moves in the correct direction but beyond the expected move implied by current option prices. This is achieved by setting up a normal butterfly spread but then skipping, or moving further out of the money, the final protective put or call.




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