Batman option strategy
Batman places a call butterfly above the market and a put butterfly below it. The payoff has two peaks, one on each side, that look like the ears of a bat.
Payoff at expiry
Nifty, lot size 65 · Nifty future 23,104 · 19 Oct 2026Legs
| Action | Option | Strike | Lots | Qty | Premium |
|---|---|---|---|---|---|
| BUY | OTM Call | 23,150 | 1 | 65 | ₹65.90 |
| SELL | OTM Call | 23,200 | 2 | 130 | ₹47.39 |
| BUY | OTM Call | 23,250 | 1 | 65 | ₹32.98 |
| BUY | OTM Put | 23,050 | 1 | 65 | ₹62.85 |
| SELL | OTM Put | 23,000 | 2 | 130 | ₹44.78 |
| BUY | OTM Put | 22,950 | 1 | 65 | ₹30.81 |
How it works
- Buy 1 OTM call at the 23,150 strike for ₹65.90, paying the premium.
- Sell 2 OTM calls at the 23,200 strike for ₹47.39 each, collecting the premium.
- Buy 1 OTM call at the 23,250 strike for ₹32.98, paying the premium.
- Buy 1 OTM put at the 23,050 strike for ₹62.85, paying the premium.
- Sell 2 OTM puts at the 23,000 strike for ₹44.78 each, collecting the premium.
- Buy 1 OTM put at the 22,950 strike for ₹30.81, paying the premium.
- You pay a net ₹533 upfront for the position. This is the most you can lose.
Below 22,955 you lose, up to ₹533.
Between 22,955 and 23,045 you profit, up to ₹2,711.
Between 23,045 and 23,158 you lose, up to ₹533.
Between 23,158 and 23,242 you profit, up to ₹2,711.
Above 23,242 you lose, up to ₹533.
Set-up: Buy 1 lot OTM Call, Sell 2 lots higher OTM Calls, Buy 1 lot next higher Call; Buy 1 lot OTM Put, Sell 2 lots lower OTM Puts, Buy 1 lot next lower Put.
What happens if Nifty moves
Profit or loss at expiry| Nifty at expiry | Move | Profit / loss |
|---|---|---|
| 21,700 | −6% | −₹533 |
| 22,400 | −3% | −₹533 |
| 22,850 | −1% | −₹533 |
| 23,100 | Unchanged | −₹533 |
| 23,350 | +1% | −₹533 |
| 23,800 | +3% | −₹533 |
| 24,500 | +6% | −₹533 |
How the Greeks affect it
When to use
When you expect a moderate move but not a big one, and are unsure of the direction.
- Low cost for two target zones.
- Risk is defined upfront.
- Does not need a view on direction.
Things to watch
- Loses if the underlying does not move at all.
- Six legs means more brokerage and slippage.
- Profit zones are narrow.
Batman: questions
What is a Batman strategy?
Batman places a call butterfly above the market and a put butterfly below it. The payoff has two peaks, one on each side, that look like the ears of a bat.
When should you use a Batman?
When you expect a moderate move but not a big one, and are unsure of the direction.
How do you set up a Batman?
Buy 1 lot OTM Call, Sell 2 lots higher OTM Calls, Buy 1 lot next higher Call; Buy 1 lot OTM Put, Sell 2 lots lower OTM Puts, Buy 1 lot next lower Put.
What is the maximum profit of a Batman?
Limited, earned if the underlying closes at either sold strike at expiry.
What is the maximum loss of a Batman?
Limited to the net debit paid, if the underlying stays at the current level or moves beyond the outer strikes.
What is the breakeven of a Batman?
With Nifty at 23,104, the example on this page breaks even at 22,955 and 23,045 and 23,158 and 23,242 at expiry.