How can iron butterfly exercise be used as a strategy in cryptocurrency trading?

1 answers

• May 02, 2022 · 3 years ago
  The iron butterfly exercise is a strategy that can be used in cryptocurrency trading to take advantage of a sideways market. It involves selling both a call option and a put option at the same strike price, while also buying a call option and a put option at a higher and lower strike price, respectively. This creates a profit zone between the two strike prices, where the trader can profit from the market staying within this range. However, it's important to note that this strategy carries risks, such as potential losses if the market breaks out of the range or if the options expire worthless. Traders should carefully consider their risk tolerance and market conditions before implementing this strategy.
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