About Butterfly Spread Profit Calculator (Formula)
You can use the Butterfly Spread Profit Calculator to see how much you’ll make from using a butterfly spread strategy. You buy and sell call or put options at three different strike prices to make the butterfly spread a popular options trading strategy.
To calculate the maximum profit per contract using this strategy, you can use the following formula:
MP = HS – LS – P
Where MP is the maximum profit per contract, HS is the higher strike price, LS is the lower strike price, and P is the premium paid.
To calculate the maximum profit per contract, it takes into account the difference between the high and low strike prices as well as the premium paid.
With this calculator, traders can make informed decisions about implementing the butterfly spread strategy and making informed decisions about its potential profits. New traders can especially benefit from this tool if they are still learning about options trading and are looking for an easy-to-use tool for calculating their profits.