The Quick & Dirty Broken Wing Butterfly is the options trading strategy we teach in the Fundamentals in Trading library as an introduction as to how to successfully trade multi-legged options positions.
The broken wing butterfly options trade is an extremely effective and resilient approach to trading when the position is managed properly. It is no wonder that it is utilized as a core position by many professional income traders from all over the world.
This being the case, we believe that the Quick and Dirty Broken Wing Butterfly is an essential foundation trading strategy that should be mastered by all income traders before moving on to other more dynamic complex options trading strategies.
The great news is that this trading strategy is something that you can continue to utilize as an income strategy even as you progress into the more advanced Pro level trader!
Many new traders think they will find a “trade” where they can follow a set of instructions and trade the same way all the time regardless, without subjectivity and receive consistent income without going through a process of learning.
On some level they expect to win all of the time, no matter what happens in the marketplace. And if you believe this, it’s not your fault. This idea is perpetuated by many trading education sites and it is extremely deceptive, so let me be clear. You can make an incredible amount of money trading but your not going to do it by ignoring the market and following a set of trade rules because NO TRADE WINS ALL THE TIME.
Realistically any trader who is going to be successful long-term needs to go a series of losses to gain experience, learn how various trades react the different market conditions, and effectively adapt to those conditions.
The problem comes in when a trader expects a trade to win all the time and a loss or a series of losses occur. When this happens many traders look for another “trade” hoping that this new one is going to win all the time and they get into this cycle of switching from trade to trade instead of actually learning how to be a trader.
We approach things differently. We not only teach you the best and most powerful income trading strategies, but we teach you when they are effective, and when they are not. And then once you understand the strategies, we teach you how to use those strategies to be adaptive and flow with the market. We teach you to be a trader. Let your journey to success begin with the Quick and Dirty Broken Wing Butterfly!
The Quick & Dirty Broken Wing Butterfly is a rule-based, viable trading strategy designed to be traded on the Russell 2000 Index (RUT) that has a minimum capital requirement of $3,500 with a profit target of 7% per trade which takes about 15 minutes a day to manage.