In options trading, a long butterfly (sometimes simply butterfly) is a name given to a combination trade that results in the following net position:
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Long 1 call at (X − a) strike
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Short 2 calls at X strike
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Long 1 call at (X + a) strike
Expiration Date of Butterfly options
They are all having the same expiration date. At expiration if the underlying is below X−a or above X+a then the position will be worth zero, and it will be worth a positive amount between these two values. The shape of a payoff function is just like an upside-down V, and the maximum payoff occurs at X. 
The price of a butterfly is always non-negative since the payoff is sometimes zero, sometimes positive.
Other ways of Creating Butterfly Options
A butterfly can also be created as follows:
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Long 1 put at (X − a) strike
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Short 2 puts at X strike
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Long 1 put at (X + a) strike
and this is equivalent to the call version since the traders are able to verify it via put–call parity.
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