Unequal-wing options payoff
Broken Wing Butterfly Calculator
Calculate a long or reverse broken-wing butterfly with calls or puts, including signed entry cost, side-specific risk, maximum profit and loss, break-even prices and expiration payoff.
Expiration payoff
| Stock price | Position intrinsic value | Profit / loss after fees |
|---|
Maximum values are modeled at expiration from the entered premiums and fees. They are not probabilities, margin requirements or live trade recommendations.
How a broken-wing butterfly works
A broken-wing butterfly, also called an unbalanced or skip-strike butterfly, uses three strikes and four contracts in a 1:2:1 ratio, but the distance from the lower strike to the middle strike differs from the distance from the middle strike to the upper strike. That unequal spacing moves risk to one side and can allow the long structure to open for a small credit.
The calculator supports calls or puts and both the long and reverse structures. It evaluates each leg directly, so it does not assume that call and put broken-wing butterflies have identical side results.
Broken-wing butterfly formulas
For calls, intrinsic at strike K is max(stock price − K, 0). For puts it is max(K − stock price, 0). Net entry includes total estimated fees and may be a debit or a credit. Maximum profit and loss are taken from the two outside plateaus and the middle-strike value; break-even prices are solved exactly on the two sloped segments.
Verified example
For a long call broken-wing butterfly with strikes US$95/US$100/US$110, premiums US$7.60/US$4.60/US$1.40, one butterfly of 100 shares and US$4 in fees, the gross entry is a US$20 credit and the net credit is US$16. At stock price US$100, the profit and maximum profit are US$516. The high-side maximum loss is US$484, the low-side result is a US$16 profit, and the only point break-even is US$105.16.
How to interpret the results
- Net entry is positive for a debit and negative for a credit after total fees.
- Low-side and high-side results show the flat expiration result outside the lower and upper strikes.
- Break-even result can contain zero, one or two point prices. If an outside plateau is exactly zero, the calculator reports a range such as “at or below the lower strike.”
- Maximum loss can be zero if the supplied prices imply no loss at expiration. That is a signal to recheck quotes, spreads and execution assumptions.
Assumptions and limits
- The strikes must be strictly increasing and the two wing widths must be unequal. Use the standard butterfly calculator for equal wings.
- All legs use the same expiration, option type, quantity ratio and contract multiplier.
- The model is expiration-only. It excludes time value, volatility changes, early assignment, dividends, taxes, bid/ask spreads, slippage and margin rules.
- Premiums are entered per share and must come from the same market snapshot. The display currency does not convert values.
Risk warning: a credit does not make every broken-wing butterfly risk-free. The wider wing commonly creates a larger loss plateau on one side, and early assignment can change real cash and margin requirements before expiration.
Related calculators
Use the Butterfly Spread Calculator for equal wings; the Iron Butterfly Calculator for the call-and-put four-leg structure; the Option Credit Spread Calculator for a two-leg vertical; and the Options Profit Calculator for a single option.