Disclaimer: The trades discussed in this blog reflect the author’s personal strategies and decisions. These are not financial advice and should not be considered recommendations to buy, sell, or hold any financial instruments. The author is not a licensed financial advisor. Options trading carries significant risk, and readers should perform their own research or consult a qualified financial advisor before making any investment decisions. Past performance does not guarantee future results.
Today I opened a zero-loss butterfly on Oracle (ORCL). Structurally, this is a bullish butterfly with a defined outcome: it cannot lose money at expiration. In the worst-case scenario, the trade settles for a $57 profit roughly three months from now.
The Trade
Here’s the structure:
Why this setup?
From a pure return perspective, this trade is objectively unattractive. A three-month US Treasury would likely yield more than $57 with less complexity. That’s not the point. The reason I’m doing this is directional: I’m bullish on ORCL, and I think the 210-230 range is achievable within the life of the trade. We talked about these types of trade on our latest YouTube video here.
ORCL was trading in that area not too long ago:
and nothing about the recent price action makes that zone feel unrealistic. If price drifts there and expires near the center of the butterfly, the payoff profile changes materially. In that case, the profit can reach a maximum of $1,057, which I find compelling given that downside is structurally removed.
This is not a trade I expect to manage actively. It’s a defined-risk, defined-outcome position where time and price location do the work. Worst case, I earn a small, bond-like return. Best case, the trade expresses my bullish view efficiently.
Gianluca Longinotti is an experienced trader, advisor, and financial analyst with over a decade of professional experience in the banking sector, trading, and investment services.
Gianluca LonginottiFinance Writer - Traders Education