The Fed has spoken. 50 basis point hike in December with continued rate hikes into next year to combat inflation. That continues to put financial stocks in a good position to gradually trade higher with interest rates.

Let’s get back on our XLF broken wing butterfly trade opening a new position today.

NEW TRADE:  Broken Wing Butterfly

SPDR Financial ETF (XLF):  35.92

TRADE ACTION:  OPEN the XLF 16 Dec 36 call / 36 put and the 16 Dec 31 put / 36.50 call for a net credit of around 0.90

STO the XLF 16 Dec 36 put

STO the XLF 16 Dec 36 call

BTO the XLF 16 Dec 31 put

BTO the XLF 16 Dec 36.50 call

We are light a couple of trades this week so we will increase the contracts on this trade. The Master Portfolio will trade 8 contracts.