A butterfly is a three-strike structure: you buy one call at a low strike, sell two calls at a middle strike, and buy one call at a high strike (all same expiry). The payoff is a tent — it peaks if the stock finishes right at the middle strike and fades to a small, defined loss on either side. It's a cheap, low-cost way to bet that a stock pins near a level: low realised volatility, not much movement.
What you're really trading
You're selling volatility in a very targeted way — you win if the market is calm and lands near your middle strike, and you lose (a little) if it moves a lot in either direction. It's a precision bet, and precision is the problem: you need the price to land in a narrow zone by a specific date.
Why there's no strategy or track record here
A butterfly only exists as live option legs at chosen strikes and expiries. There's no listed fund that packages a rolling butterfly with a real, total-return history — so any backtest we showed would be a simulation of an option chain, and a credible simulation needs real historical chains and realistic fills or the numbers are fiction. We won't publish fiction as a track record (see the methodology and how we frame backtests). So this stays an explainer, not a product. For the options exposure we can stand behind — via real funds — see Options Income, Wheel Income, and Defined-Outcome Buffer.
Educational material — not investment advice.