Directional Batman Spread

Double Long Christmas Tree Spread will always make a payoff like Batman. It is also called Directional Batman Spread.

Directional Aspects of the Double Long Christmas Tree Spread

• It is one of those strange spreads where you can not call it bullish or bearish but it has to be either of them.
• It can not be neutral.

As it is more nuanced than typical Directional bets, Let’s explore why –

• Long Call Christmas Tree Spread: This is structured to benefit from a slight to moderate upward movement in the underlying asset.
• Long Put Christmas Tree Spread: Conversely, this spread is designed to profit from a slight to moderate downward movement in the underlying asset.

Combining the Spreads

• When you combine these two spreads, you create a position that can potentially benefit from moderate moves in either direction.
• However, the key is “moderate” movement. The strategy does not favor large swings in either direction but instead looks to capitalize on limited, defined movements.

Unlike a purely directional strategy that bets heavily on a significant move in one direction, the Double Long Christmas Tree Spread has a dual-directional bias.