Mike Khouw Sees Unusual Options Activity In SPDR S&P Biotech (ETF)

A trader bought the September 75/80/85 call butterfly for $0.85. The trade breaks even at $75.85, or around 9 percent higher, and it can make its maximal profit of $4.15 if it closes at $80 at the September expiration. Above $80, the profit starts to trail off, and the trade starts to lose money above $84.15. It can maximally lose $0.85.