How to Use an Options Call Butterfly for Rangebound Stocks

Key PointsStocks spend the majority of time in a trading range or consolidation, which can be frustrating for traders since breakout and breakdown attempts result in head fakes and wiggles.A long-call butterfly spread strategy enables options traders to profit during consolidation periods.A call butterfly spread is comprised of selling 2 mid-strike calls (body) and buying 1 lower-strike and 1 higher-strike call (wings). They are a combination of a bear call credit spread and bull call debit spread.5 stocks ...