Call butterfly

A strategy combining a bull spread and a bear spread, constructed using call options or put options on the same underlying with the same maturity at three different exercise prices. A long butterfly refers to the purchase of two options of the same type, one with a lower exercise price and the other with a higher exercise price, and to the simultaneous sale of two other options of the same type as the purchased options, at the same middle exercise price. A short butterfly refers to the sale of two options of the same type, one with a lower exercise price and the other with a higher exercise price, and to the simultaneous purchase of two other options of the same type as the options sold, at the same middle exercise price.