FUTURES SPREAD
THREE LEGS · CURVE SHAPE

Futures Butterfly Seasonality: Test the Three-Leg Window

A seasonal butterfly can be more sensitive to contract mapping than a simple calendar spread. Changing the middle month or year offset can change the economic position entirely.

Futures Spread · Educational guide · Updated September 2026

A seasonal butterfly can be more sensitive to contract mapping than a simple calendar spread. Changing the middle month or year offset can change the economic position entirely.

Hold the structure constant

Record the product, exact three months and year for each leg, along with the +1/−2/+1 direction. Apply the same relative months and year offsets for every historical sample. A March–May–July basket is not interchangeable with a May–July–September basket merely because both have three legs.

Require all three price observations

Calculate the weighted quote only when A, B and C all have valid prices on the chosen date. On entry and exit, all three must be present for the year to count as a completed hypothetical trade. Do not fill missing prices with zero or silently switch a dated leg to a continuous nearby series.

Inspect the path, not just the endpoint

For each year, calculate F at entry and exit, then multiply the difference by the contract multiplier for a matching-unit basket. Review the middle-of-trade drawdown, year-by-year results and how many years actually qualified. A win rate computed after optimizing dates is descriptive of the selected sample, not a forecast.

Stress the apparent edge

Try neighboring windows, remove the strongest year, compare lookback periods and reserve later years as an untouched check. Add commission and slippage for every leg. If a pattern only works in one exact date pair after many trials, it needs stronger evidence.

Test the exact dated structure

Inspect the leg months, historical years and selected window before drawing a conclusion from an average curve.

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Frequently asked questions

Can the blue seasonal curve be read as a future price?

No. It is a historical research summary; normalization may change its displayed level.

Why are some years absent?

A dated leg or a synchronized entry/exit price may be unavailable. Show the actual completed sample.

Exchange references

Use the exchange material for product definitions and confirm current specifications, listed combinations and margins with your broker.

Continue the Futures Butterfly Spreads series

Also read Futures Spread Trading and Calendar Spread Trading.

Bring the formula to the chart

Compare a defined structure across historical years and review every leg before making a decision.

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Educational material only, not investment advice. Examples are illustrative. Historical results do not guarantee future performance. Trading costs and slippage are excluded unless explicitly stated.

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