TradingView strategies / Butterfly spreads
Three strikes, four contracts, one expiration
A standard long butterfly holds +1 lower-strike option, -2 center-strike options and +1 upper-strike option. All legs use the same underlying, option type, expiration and deliverable. For a short butterfly the quantities are -1, +2 and -1. Calls and puts have the same expiration intrinsic shape when the strikes are equally spaced; their entry premiums and assignment exposures can differ.
With strikes K1 < K2 < K3, the required width is W = K2 - K1 = K3 - K2. The center is the long butterfly peak and short butterfly trough. Moving the center changes the target expiration price. Increasing width changes the payoff geometry, but actual premiums determine whether reward relative to risk improves. Unequal wings are a different risk structure and are not calculated here.
Reproduce the 95 / 100 / 105 example
The hypothetical calls cost 7, 4 and 2 per share; the puts cost 2, 4 and 7. Both give D = p1 - 2 × p2 + p3 = 1. With a 100 multiplier, one butterfly unit costs $100 before fees. Four entry contracts at $0.65 each cost $2.60. These are chosen inputs, not market observations.
| Expiration price | Long call or put | Short call or put |
|---|---|---|
| 95 or below | -$102.60 | $97.40 |
| 98 | $197.40 | -$202.60 |
| 100 (center) | $397.40 | -$402.60 |
| 102 | $197.40 | -$202.60 |
| 105 or above | -$102.60 | $97.40 |
Long breakevens including entry fees are 96.026 and 103.974; short breakevens are 95.974 and 104.026. Cards round prices to cents. With two units and a hypothetical multiplier of 10, long maximum profit becomes $74.80 and maximum loss $25.20: the premium exposure scales with the multiplier, while eight contract fees remain $5.20.
Check the formula before trusting the shape
For calls, I(S,K) = max(S-K,0); for puts, I(S,K) = max(K-S,0). Define B(S) = I(S,K1) - 2I(S,K2) + I(S,K3), quantity Q, multiplier M, entry fees F = 4Qf, and direction d = +1 for long or -1 for short. Expiration P/L = d × [B(S)-D] × MQ - F.
For ordinary premiums 0 < D < W, long maximum profit is (W-D)MQ-F and loss is DMQ+F. Short maximum profit is DMQ-F and loss is (W-D)MQ+F. If fees consume the positive payoff, the tool reports no positive maximum profit. Two distinct breakevens exist only when 0 < D+dF/(MQ) < W; they are K1 plus this offset and K3 minus it.
Build the same structure in TradingView Options
- Choose one underlying and expiration in the Options strategy builder. Add the three call legs or three put legs.
- Set signed quantities to +1/-2/+1, verify equal strike gaps, and enter the premiums used in this calculation. Reverse all directions for the short comparison.
- Compare expiration P/L at both wings and the center. Keep a pre-expiration theoretical value separate from expiration intrinsic value.
- Use Pineify's available option-chain snapshots to inspect contracts, then record the timestamp, price basis, multiplier, fees and leg assumptions in your trading journal notes. An incomplete chain is not proof that a strike does not exist.
The builder supports position directions, size and price adjustments, as documented by TradingView. This workflow compares scenarios; it does not run a historical multi-leg backtest or certify an executable spread price.
Where the calculation stops
A tent-shaped payoff assumes all legs remain intact through expiration. American-style short options can be assigned early. Near a strike, uncertain exercise decisions can leave underlying exposure after the other legs expire. Broker deadlines, dividends, settlement rules and buying power can matter before the modeled terminal loss is reached.
The calculator rejects zero or negative debit, debit at least as wide as the wings, invalid quantities and mismatched snapshot multipliers. Such inputs may signal stale prices or incompatible contracts. It does not infer a risk-free opportunity. Adjusted contracts, broken wings, changing volatility, early exits and closing fees require separate analysis. Educational scenarios are not investment advice.
Strategy references: OIC long call butterfly, OIC long put butterfly, and OIC short call butterfly. Snapshot fields and pagination: Massive option chain documentation. Sources reviewed October 21, 2026.