Iron Condors (The Best Option Strategies Book 2) by Wolfinger Mark

Author:Wolfinger, Mark [Wolfinger, Mark]
Language: eng
Format: mobi, epub
Publisher: Options for Rookies Books
Published: 2014-07-26T23:00:00+00:00

For the newer trader, this is a topic (probability of touching) of lesser importance right now. However it is something worth understanding and a more detailed discussion is presented in Appendix A.

RUT Feb 1040 put

Delta: -8.

The put spread: Feb 1020/1030 put.

Spread quote: $0.35 to $0.55.

Wide spread quote: $0.25 to $0.55; True midpoint: $0.40.

Estimated premium available: $0.35 (available right now because that is the bid, or possibly the true midpoint, $0.40).

Comment: Once again, this is similar to previous choices. Premium is another $0.05 higher and the option is another 10 points closer to the underlying market price (1148). This spread is 108 points OTM.

The remaining puts and put spreads

It may seem tedious to look at every put option (and every call option once you are finished with the puts) to find two spreads that, when combined into an iron condor, are best suited to your personal needs. And if you are a new to trading iron condors (or credit spreads in general), then it is well worth your time to go through a thought process as described above. You do not yet have enough experience to know which options are good alternatives for your situation.

It is tedious. However, this is not a big problem because as time passes (it may only require one or two iron condor trades) and you manage the trades, you should be able discover where your comfort zone lies and therefore cut the initial list of option spreads to a modest quantity. I will offer some ideas on how to get started with something that is likely to be quite suitable for you right now. Then, as you practice (in a paper-trading account) managing iron condors by opening a variety of positions and managing each one from entry to exit, you will discover that you are suddenly comfortable enough to begin trading with real money.

NOTE: It is not important to choose the ‘best possible’ iron condor because there is no such thing. Instead there are several ‘very good’ choices that vary from one trader to another.

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.