BREXIT Setups.....06.18.16

First of all, a disclaimer.  THIS IS NOT INVESTMENT ADVICE.  These two setups are just strategies you might consider to gain an edge from the upcoming BREXIT/BREMAIN vote coming later this week.  The vote could go either way and the talking heads are all over the map trying to decide if this is going to be another Y2K non-event or whether a BREXIT yes vote will create a domino effect of EU defections that will produce an unstable Europe filled with significant economic uncertainties.
Either way we can expect extreme volatility on the 24th and here are 2 simple option setups, a straddle and a butterfly. These are short term options, set to expire on the 24th so the decay factor really doesn't factor into the equation.
These setups focus on the SPY.  If you look at the same setups for EFA (ETF of Europe's largest 900 companies) you'll quickly see that the odds skew is clearly bearish, which makes perfect sense since a yes vote will slam Europe more (relatively) than the US.
First the straddle>>>> easy to set up, lots of liquidity and unlimited profit potential if things take off.

The butterfly is a credit spread and your profit potential is restricted at the outset. Randy describes a short call 1:2:1 butterfly and this is one spread using that symmetry.  Note that the breakeven bracket is narrower on the butterfly than the straddle.  The narrower the spread the lower the net credit so we have to open up the spread a bit to allow for a reasonable risk/reward. The Brexit vote IMHO offers a unique high odds wide spread opportunity.