Batman Spread

A batman spread is an innovative four-leg strategy that uses deliberately unequal wing widths to exploit volatility skew patterns while maintaining limited risk characteristics, making it a favorite among professional options traders who understand market microstructure. This advanced strategy involves creating asymmetric butterfly spreads where the wing distances are intentionally unequal, allowing traders to take advantage of volatility smile effects and skew patterns that create pricing inefficiencies in the options market. The batman structure is particularly effective when far out-of-the-money options are relatively cheap compared to at-the-money options, creating opportunities for enhanced risk-adjusted returns. Professional traders use this strategy to optimize premium collection while maintaining the safety of defined risk spreads. The asymmetric design allows for better capital efficiency and more favorable breakeven points compared to traditional symmetric butterflies. The strategy requires sophisticated understanding of volatility dynamics and Greeks management

If NIFTY is at ₹25,800, set up: Buy ₹25,700 Call for ₹85, Sell two ₹25,800 Calls for ₹120 each, Buy ₹26,100 Call for ₹65, creating ₹30 net credit with asymmetric profit zones and limited risk of ₹270 maximum.