Archive for the ‘Iron Condor Backtest’ Category

Iron Condor

Monday, September 1st, 2008

Iron Condor: High Return Iron Condor Trading Results: 275% Gain? Is this for real?

Iron Condor: Recently I back tested a particular Iron Condor Option Trading Strategy in a very specific way (using very particular entry, exit, and management rules found here) – and the results were pretty spectacular.

In fact – these high return iron condor results were so impressive, I had to re test several times to make sure I hadn’t made a mistake. Each time they came out the same.

Now right off the bat, back testing various option trading strategies presents some issues that need to be addressed. It’s not quite the same as real trading. There are factors such as slippage, quirky data, and probably the most important: the emotional roller coaster involved with real trading that isn’t present when rolling back through time on a software program and the stress involved with having REAL hard earned money on the line.

But… even if I cut this Iron Condor Trade return in HALF to take into account the differences between real trading and back trading (which I think is more than enough) a 137% return on my investment is certainly fine by me.

So about those high return back testing results…

My entry, exit, management and adjustment rules I used were based on a ‘formula’ found in the Complete Iron Condor Strategy Guide E-Book by Optionbox.com (you can get a version of the guide for free thru email by going here).

An here are those iron condor strategy back tested results…

2006
12 Wins, 0 Losses
116.6 % Return

2007
11 Wins, 1 Loss
98.5% Return

2008
Jan thru Jun
6 Wins, 0 Losses
60.9% Return

Now math is certainly not my strong point, but I calculate this is around a 275 % return on investment in 2 and a half years – or just under 110% return per year. And if I cut this return in half to take into account the issues talked about earlier with backtesting – 55 % annual returns certainly aren’t too shabby!

So could this be for real? If I went out and started to trade this specific Iron Condor trade ‘formula’ in a live account, should I expect to start making 55% or better annual results?

We shall see…

Bookmark my site and check back here soon. I plan to start off on this Iron Condor adventure - and I’d like to invite you to come along with me for the ride!

J.J

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