The condor spread is one of the lesser known and/or used option spread strategies.

While the name is similar to the more popular ‘iron condor’ strategy - the ‘condor spread’ is different - even while the risk graph of the trade looks the same.

The difference between the condor and the iron condor is that the condor spread is constructed of all calls or puts - while the ‘iron condor’ is comprised of BOTH call options and put options.

An iron condor example on IBM looks as following:

Buy 2 110 IBM Puts
Sell 2 115 IBM Puts
Sell 2 125 IBM Calls
Buy 2 130 IBM Calls

The iron condor example above utilizes both calls and puts - and it is constructed of 2 separate credit spreads.

A condor example on the same underlying would look as follows -

Buy 2 110 IBM Puts
Sell 2 115 IBM Puts
Sell 2 125 IBM Puts
Buy 2 130 IBM Puts

The condor example above uses ONLY puts - and is composed of a put debit spread as well as a put credit spread.

While constructed differently however - if you were to compare these two option spread strategies next to each other on a risk graph or payoff diagram - they would look extremely similar if not identical.

photo credit: edenpictures

condor spread is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, condor spread, Credit Spread, Iron Condor, iron condor spread, iron condors, option selling, option spread trading, Vertical Spread

Related Iron Condor Info:

1. Iron Condor An option selling strategy that has gained a lot...
2. Vertical Spread At the core of the iron condor strategy is...
3. Option Spread Trading Several different option spread trading strategies which investors can...
4. Condor Spread - All Calls or Puts Similar to an iron condor spread trade, the Condor...
5. Butterfly Strategies - Variations of the Trade A variety of individual butterfly strategies are in the...

Several different option spread trading strategies which investors can use for creating monthly income include the iron condor, credit spread (or vertical spread) - the butterfly spread - and others.

Option spread trading refers to the act of selling one option and buying one option. In the case of the iron condor strategy - these options would usually be in the same month. Credit spread option strategy would include the same month options as well - and the options would either be all calls or all puts. Diagonals would be comprised of the same underlying - however the months could be different months - and the same is true with calendar spreads.

Non directional trading investors find option spread  trading enticing because it is a way for them to use leverage to benefit from the theta decay of options while limiting their risk. These trades allow the option trader to sell premium and collect that theta - while purchasing cheap ‘insurance’ to cover themselves in a worse case scenario.

Option spread trading has become fairly popular recently and more and more retail traders are getting their feet wet in this type of investing - whereas not too long ago these type of option spread strategies were little known and traded only by professionals.

photo credit: pfala

Option Spread Trading is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: butterlfy spread, Credit Spread, Iron Condor, iron condor spread, iron condors, option selling, option spread trading, Vertical Spread

Related Iron Condor Info:

1. Iron Condor Iron Condor: How To Place, Manage, and Adjust Iron...
2. Iron Condor - Practical ‘How To’ Information You Can Actually Use *** THE ‘HOW TO’ of OPTIONS TRADING *** One...
3. condor spread The condor spread is one of the lesser known...
4. Option Selling Option selling has become more main stream recently as...
5. Vertical Spread At the core of the iron condor strategy is...

At the core of the iron condor strategy is the vertical spread.

If we were to reverse engineer the iron condor strategy - take it apart - split it in half - and look at what the spread is actually constructed from - we would find that it is simply 2 credit spreads. A vertical spread on either side.

Usually the iron condor trader will construct their trade anywhere from 1 to 3 months away from expiration day. For example - if an iron condor trader were setting up a March trade - the trade might be initiated as early as Jan of that year. I think most iron condor traders would agree that this might be as far away from expiration one might want to place this type of trade - and it seems as though most prefer to place them much closer to expiration day - usually somewhere in the 30 to 40 day range.

To place an iron condor trade - the investor would either sell 2 separate vertical spread - or credit spread - an equal distance away - or out of the money - from where the ETF they are trading with is presently trading at.

For example - if the investor were placing an iron condor on the SPY - they would sell a call vertical spread above where the SPY is trading at - and they would sell a put vertical spread below where the SPY is trading at.

These two individual credit spreads can be sold either one at a time - which some refer to as ‘legging in’ - or some brokers allow them to all be placed together as a full iron condor ‘package’.

photo credit: Orin Zebest

Vertical Spread is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, iron condor spread, iron condors, option selling, option spread trading, Vertical Spread

Related Iron Condor Info:

1. condor spread The condor spread is one of the lesser known...
2. Iron Condor An option selling strategy that has gained a lot...
3. Option Selling Option selling has become more main stream recently as...
4. Option Spread Trading Several different option spread trading strategies which investors can...
5. Condor Spread - All Calls or Puts Similar to an iron condor spread trade, the Condor...

is a post from: Iron Condor - FREE Trading Videos

Related Iron Condor Info:

1. ** Dipping Our Iron Condor Toe Back In The Water ** Iron Condor Video Training, Tools, and more - Click...
2. *** MORE IRON CONDOR / BUTTERFLY TRADES SOARING *** Iron Condor Video Training Course, Tools, Webinars, and more...
3. IRON CONDORS - RUT JULY IRON CONDOR - CLOSED  RUT IRON CONDORS - JULY 09 6-26-09 This month...
4. JULY SPY BUTTERFLY - IRON CONDORS CLOSED This month we ran another SPY Butterfly Spread -...
5. *NEW* Live Option Trading Lab I just found out that these Option Trainers are...

Option selling has become more main stream recently as more and more retail traders learn about the various option spread trading strategies which can provide actually quite impressive returns over short periods of time.

Option selling is the act of an investor ’selling’ an option - either call or put - to bring a credit into their account. The trader doesn’t necessarily have to own the option prior to selling it - or even own a related base asset such as the stock that the option is derived from (such as is the case with covered call selling)

Even though the investor may not need to own the option first - or a related asset - in most cases the investor DOES need to have enough cash in their account to ‘cover’ the sold option if it were assigned - or they could also cover it by purchasing another nearby option - such as would be done in the case of a credit spread option position - or a debit spread.

Some popular option selling strategies include:

Iron Condor
Credit Spread
Butterfly Spread

Option selling is a great way for investors to benefit from the fact that options are a decaying asset.

photo credit: TheTruthAbout…

Option Selling is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, iron condor spread, iron condors, option selling, option spread trading, Vertical Spread

Related Iron Condor Info:

1. Iron Condor Iron Condor: How To Place, Manage, and Adjust Iron...
2. condor spread The condor spread is one of the lesser known...
3. Iron Condor An option selling strategy that has gained a lot...
4. Vertical Spread At the core of the iron condor strategy is...
5. Option Spread Trading Several different option spread trading strategies which investors can...

An option selling strategy that has gained a lot of popularity in recent years is the iron condor.

This option spread trading method is comprised of two vertical spreads - or credit spreads - on the same underlying stock / ETF / index. It is made up of an out of the money bear call spread - a credit spread option trade that benefits when the underlying asset remains below the sold short strikes - and a bull put spread on the opposite side of the position.

While there are numerous ways to trade the iron condor option spread trading technique - one popular way is to sell the shorts on either side as far away as possible with the hope being that while the trade is in progress the stock / index vehicle being used won’t reach those levels - which the probabilities say they shouldn’t.

Although it is true that this trade is a high probability trade and when placed correctly the trading asset being used should not breach either sold strike of the trade - of course this is always a possibility - and the risk on these trades can be significant.

Regardless of the favorable probabilities traders of the iron condor option trading strategy should always have a risk management plan in place before putting on these trades.

photo credit: James Byrum

Iron Condor is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, option selling, option spread trading, Vertical Spread

Related Iron Condor Info:

1. Iron Condor Iron Condor: How To Place, Manage, and Adjust Iron...
2. Option Selling Option selling has become more main stream recently as...
3. Vertical Spread At the core of the iron condor strategy is...
4. Option Spread Trading Several different option spread trading strategies which investors can...
5. Condor Spread - All Calls or Puts Similar to an iron condor spread trade, the Condor...

Here is an illustration of a condor spread -

Go long 4 50 Calls
Go short 4 55 Calls
Go short 4 60 Calls
Go long 4 65 Calls

The risk profile of this looks similar to that of the iron condor.

Also - if once one takes a good look at the trade, it also could be argued that this trade is a split strike butterfly trade - or a traditional butterfly trade where the shorts being sold are separated.

Finally - the condor trade - like the one illustrated above - is also a common adjustment technique used by iron condor traders to ‘roll’ the side that is in trouble further away from a threatening move.

For example, in the illustration above, of an iron condor trader had a trade on where the call side was made up of a sold 50 / 55 call credit spread - and it was being threatened - a way that trader could adjust the trade would be to roll the threatened credit spread further up away from the underlying.

To do this in one simple trade would be to place the trade described above - which would wind up moving the 50 / 55 call credit spread up to a 60 / 65 call credit spread.

Condor Spread - All Calls or Puts is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, condor spread, Credit Spread, Iron Condor

Related Iron Condor Info:

1. Straddle Spread - What The Butterfly Spread Trade Wants To Be If one were to take the iron butterfly spread...
2. Iron Condor An option selling strategy that has gained a lot...
3. Option Selling Option selling has become more main stream recently as...
4. Vertical Spread At the core of the iron condor strategy is...
5. Butterfly Strategies - Variations of the Trade A variety of individual butterfly strategies are in the...

If one were to take the iron butterfly spread apart - reverse engineer it if you will - then take a look at the components - they could come to the determination that the butterfly spread trade is basically a straddle spread - with cheaper wings purchased for protection.

At the core of the trade - it’s just the sale of a straddle. It’s what the iron butterfly spread trade really wants to be.

Following is an example of an iron butterfly trade:

Purchase 1 36 Put
Sell 1 38 Put
Sell 1 38 Call
Purchase 1 40 Call

If you remove the 2 purchased options - the 36 put and the 40 call what is left?

The short 39 put and the short 38 call. A sold straddle.

This straddle is what makes this trade money. The purpose of the 2 purchased wings is to provide protection and margin relief.

photo credit: sidewalk flying

Straddle Spread - What The Butterfly Spread Trade Wants To Be is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, straddle spread

Related Iron Condor Info:

1. Iron Condor An option selling strategy that has gained a lot...
2. Option Selling Option selling has become more main stream recently as...
3. Vertical Spread At the core of the iron condor strategy is...
4. Condor Spread - All Calls or Puts Similar to an iron condor spread trade, the Condor...
5. Butterfly Strategies - Variations of the Trade A variety of individual butterfly strategies are in the...

A variety of individual butterfly strategies are in the option income traders ‘toolbox’ for use - including the ‘regular’ butterfly consisting of either calls or puts, the iron butterfly position, and the broken wing butterfly - or ’skewed’ butterfly.

The ‘regular’ or traditional butterfly is made up of either all calls or put options. These are usually constructed with the short strikes being sold at or near where the stock or underlying investment vehicle is currently trading at. The wings of this version of the butterfly spread are bought out an equidistant length away from where the shorts were sold.

An Iron Butterfly could actually be viewed as an iron condor - it is made up just like an iron condor trade -  the difference being that the shorts are sold at the same strike price as each other - as if attached together. One could think of this trade as an iron condor just ‘pushed’ together in the middle.

The broken wing butterfly can be made up of puts, calls - or both calls and puts. What makes this trade different is that both wings are not spaced apart equally on either side. One wing is shorter than the opposite side - making this trade ’skewed’.

Usually traders consider the butterfly spread trade to be a non directional trade - however these trades can also be constructed to be played directionally.

photo credit: Diganta Talukdar

Butterfly Strategies - Variations of the Trade is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, butterfly strategies, Credit Spread, Iron Condor

Related Iron Condor Info:

1. Iron Condor An option selling strategy that has gained a lot...
2. Vertical Spread At the core of the iron condor strategy is...
3. Option Spread Trading Several different option spread trading strategies which investors can...
4. Condor Spread - All Calls or Puts Similar to an iron condor spread trade, the Condor...
5. Straddle Spread - What The Butterfly Spread Trade Wants To Be If one were to take the iron butterfly spread...

Butterfly Spread Trade - March 2010 - RUT

This last week we closed out our RUT Iron Butterfly Trade for a profit of just over 10%.  Total days in trade: 8 days.

Learn more on these butterfly spread trades.

MARCH 2010 BUTTERFLY - IRON CONDOR CLOSED is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. Iron Condor Iron Condor: How To Place, Manage, and Adjust Iron...
2. *** Feb Iron Condor Expiration *** New Iron Condor Training, Tools, Webinars, and more -...
3. JULY SPY BUTTERFLY - IRON CONDORS CLOSED This month we ran another SPY Butterfly Spread -...
4. Iron Condor An option selling strategy that has gained a lot...
5. Vertical Spread At the core of the iron condor strategy is...

—— OPTION *INCOME* VIDEOS ——

Learn Option Income Trading Strategies
Most Option Traders Don’t Know Exist.

Click Here

*********************************************

In this weeks issue…

*  NEW - LIVE *Option Strategy Trading Lab*
*  Which Way Is This Market Headed?
*  VIDEO: The Protective Put Strategy
*  VIDEO: RUT Bearish Vertical Spread
*  VIDEO: Wall St. Wrap Up & Trader Tax Chat
*  VIDEO: Love Story…

Read this weeks report… Click Here

*********************************************

To learn more join our weekly option trading email newsletter by Clicking Here

*** Weekly Option Trading Report *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Option Strategy

Related Iron Condor Info:

1. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
2. *** IRON CONDOR - Geoffs Christmas Trading Video *** New Iron Condor Course, Video Training, Tools, and more...
3. *** MORE IRON CONDOR / BUTTERFLY TRADES SOARING *** Iron Condor Video Training Course, Tools, Webinars, and more...
4. *** THE HOLY GRAIL OF OPTIONS TRADING? *** *** Is There Actually Such A Thing As A...
5. – 2 New Iron Condor / Option Trading Strategy Videos – – 2 New Iron Condor / Option Trading Strategy...

To learn more CLICK HERE

Ready for an unprecedented ‘inside look’ into how professional
traders find successful trades and how they manage risk?

Or how to get ‘live’ actionable trading ideas?

These Live Trading Labs allows you to ‘watch over the shoulders’
of expert options traders as they identify the most profitable
trades that the market has to offer, and then TRADE THEM.

Right there, Live in front of your eyes…

To learn more CLICK HERE

*NEW* Live Option Trading Lab is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Credit Spread, Iron Condor, Options Trading System

Related Iron Condor Info:

1. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...
2. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
3. *** THE HOLY GRAIL OF OPTIONS TRADING? *** *** Is There Actually Such A Thing As A...
4. Option Selling Option selling has become more main stream recently as...
5. Option Spread Trading Several different option spread trading strategies which investors can...

*********************************************

*** VIDEO: COVERED COMBO STRATEGY ***

*** VIDEO: BULLISH VERTICAL SPREAD ***

Click Here to join our newsletter and learn more about these videos
and other option trading education.

– 2 New Iron Condor / Option Trading Strategy Videos – is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Option Strategy

Related Iron Condor Info:

1. *** FREE TRADING VIDEOS *** Iron Condor Training, Tools, and more - Click Here...
2. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
3. *** IRON CONDOR - Geoffs Christmas Trading Video *** New Iron Condor Course, Video Training, Tools, and more...
4. Option Spread Trading Several different option spread trading strategies which investors can...
5. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...

Right before closing out butterfly trade position (above)

We love trading these butterfly spread trades - iron condors on the SPY as they are so liquid and easy to get in and out of.

JULY SPY BUTTERFLY - IRON CONDORS CLOSED is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Option Strategy, Vertical Spread

Related Iron Condor Info:

1. – 2 New Iron Condor / Option Trading Strategy Videos – – 2 New Iron Condor / Option Trading Strategy...
2. Iron Condor An option selling strategy that has gained a lot...
3. Vertical Spread At the core of the iron condor strategy is...
4. Option Spread Trading Several different option spread trading strategies which investors can...
5. MARCH 2010 BUTTERFLY - IRON CONDOR CLOSED Butterfly Spread Trade - March 2010 - RUT This...

6-26-09

This month we took our iron condors off a little earlier than we normally would allowing us almost 3 full weeks of ‘vacation’ - not having to worry or watch the market in regards to this trade whatsoever. These last few months have been beautiful for these trades.

Also see some of this months other trades at our butterfly spread trade blog

Disclaimer Earnings Disclaimers Terms of Service Privacy Policy

IRON CONDORS - RUT JULY IRON CONDOR - CLOSED is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: adjust iron condor, Iron Condor, iron condor adjustment, iron condor spread, iron condor strategy, iron condors

Related Iron Condor Info:

1. Iron Condor / Butterfly Spread Trade closed for May 09 Last expiration cycle a new adjusting technique used to...
2. *** RUT JUN IRON CONDOR CLOSED ***  RUT IRON CONDOR - JUNE 09 - CLOSED  5-27-09...
3. *** SPY JUN BUTTERFLY - IRON CONDORS CLOSED *** SPY BUTTERFLY - JUNE 09 - CLOSED 6-15-09 6-15-09...
4. JULY SPY BUTTERFLY - IRON CONDORS CLOSED This month we ran another SPY Butterfly Spread -...
5. MARCH 2010 BUTTERFLY - IRON CONDOR CLOSED Butterfly Spread Trade - March 2010 - RUT This...

SPY BUTTERFLY - JUNE 09 - CLOSED

6-15-09

6-15-09

This months Spy Butterfly turned out nicely. On closure of main position left some extra OTM long calls on since they were worth less than what it would have cost in commisions to close them - AND - if the market blasted off for some reason before expiration day they could become a nice little lottery ticket.

To learn more JOIN OUR FREE IRON CONDORS NEWSLETTER. Click Here

Find more on this and other trades at butterfly spread blog / site.

Disclaimer Earnings Disclaimers Terms of Service Privacy Policy

*** SPY JUN BUTTERFLY - IRON CONDORS CLOSED *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Iron Condor, Iron Condor Adjustments, iron condors, option trading strategy

Related Iron Condor Info:

1. IRON CONDORS - RUT JULY IRON CONDOR - CLOSED  RUT IRON CONDORS - JULY 09 6-26-09 This month...
2. NEW OPTION TRADING VIDEO SHOW Learn to Manage and ADJUST Iron Condors -go to:...
3. *** THE FORGOTTEN OPTION TRADING STRATEGY *** Learn Iron Condor Trading Secrets - Check out this...
4. Iron Condor / Butterfly Spread Trade closed for May 09 Last expiration cycle a new adjusting technique used to...
5. *** RUT JUN IRON CONDOR CLOSED ***  RUT IRON CONDOR - JUNE 09 - CLOSED  5-27-09...

Options University is putting on a promotion over the next couple weeks where they are giving this course away for free.

Click the following link to secure your free copy of this course: Options Mastery Course by Options University

Get this $2000.00 Options Mastery Course FREE is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: option mastery course, option university, options mastery course, options university, optionsuniversity.com, ron ianieri

Related Iron Condor Info:

1. *** GREAT NEW OPTIONS TRADING VIDEO COURSE *** Go Here to get our Free Iron Condor Weekly...
2. *** THE HOLY GRAIL OF OPTIONS TRADING? *** *** Is There Actually Such A Thing As A...
3. *** IRON CONDOR - PRACTICAL APPLICATION CLASS *** In this weeks Iron Condor Option Free Newsletter… * ...
4. Option Spread Trading Several different option spread trading strategies which investors can...
5. *NEW* Live Option Trading Lab I just found out that these Option Trainers are...

5-27-09

5-24-09

This months Iron Condor trade was pretty much text book perfect. Put it on, place our exit orders, take it off. Almost seems like there’s something ‘wrong’ here with the market behaving so nicely…

To learn more about trading iron condors join our free email mini course / newsletter by Clicking Here

Disclaimer Earnings Disclaimers Terms of Service Privacy Policy

*** RUT JUN IRON CONDOR CLOSED *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: adjust iron condor, Iron Condor, iron condor adjustment, iron condor spread, iron condor strategy

Related Iron Condor Info:

1. NEW OPTION TRADING VIDEO SHOW Learn to Manage and ADJUST Iron Condors -go to:...
2. *** THE FORGOTTEN OPTION TRADING STRATEGY *** Learn Iron Condor Trading Secrets - Check out this...
3. Iron Condor / Butterfly Spread Trade closed for May 09 Last expiration cycle a new adjusting technique used to...
4. *** SPY JUN BUTTERFLY - IRON CONDORS CLOSED *** SPY BUTTERFLY - JUNE 09 - CLOSED 6-15-09 6-15-09...
5. IRON CONDORS - RUT JULY IRON CONDOR - CLOSED  RUT IRON CONDORS - JULY 09 6-26-09 This month...

*  PRACTICAL APPLICATION: Options Class
*  VIDEO: Long Call Butterfly
*  VIDEO: SPY Straddle
*  VIDEO: Wall Street Up
*  VIDEO: Drifting

***************************************

*** PRACTICAL APPLICATION: OPTIONS CLASS ***

Tired of learning a bunch of Options *Theory* but having
NO IDEA how to actually use it to make money?

New ‘Practical Applications’ Options Trading Class allows
you to log in real time on your computer, watch and ‘do’
along with professional options traders as they teach you
firsthand how to use option strategies to generate income.

Sign up for our free iron condor option newsletter and learn more

To subscribe to our Free Iron Condor newsletter, go here

Disclaimer Earnings Disclaimers Terms of Service Privacy Policy

*** IRON CONDOR - PRACTICAL APPLICATION CLASS *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: condor spread, Iron Condor, iron condor option, iron condor options, iron condor spread, iron condor trading, iron condors

Related Iron Condor Info:

1. Iron Condor - Practical ‘How To’ Information You Can Actually Use *** THE ‘HOW TO’ of OPTIONS TRADING *** One...
2. NEW OPTION TRADING VIDEO SHOW Learn to Manage and ADJUST Iron Condors -go to:...
3. Iron Condor / Butterfly Spread Trade closed for May 09 Last expiration cycle a new adjusting technique used to...
4. *** RUT JUN IRON CONDOR CLOSED ***  RUT IRON CONDOR - JUNE 09 - CLOSED  5-27-09...
5. IRON CONDORS - RUT JULY IRON CONDOR - CLOSED  RUT IRON CONDORS - JULY 09 6-26-09 This month...

The market over the last several weeks have been beautiful for iron condor traders as well as other option ‘theta’ range bound trading.

Adjusting Iron Condor Positions. is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: adjusting iron condor, Iron Condor, Iron Condor Adjustments, iron condor spread, iron condor trading, iron condors

Related Iron Condor Info:

1. ** GOOD IRON CONDOR / OPTION ‘ADJUSTMENT’ ARTICLE ** Iron Condor Training, Tools, and more - Click Here...
2. *** THE FORGOTTEN OPTION TRADING STRATEGY *** Learn Iron Condor Trading Secrets - Check out this...
3. *** IRON CONDOR - PRACTICAL APPLICATION CLASS *** In this weeks Iron Condor Option Free Newsletter… * ...
4. IRON CONDORS - RUT JULY IRON CONDOR - CLOSED  RUT IRON CONDORS - JULY 09 6-26-09 This month...
5. Option Spread Trading Several different option spread trading strategies which investors can...

‘Scalping Theta’ uses the underlying STOCK to manage the option position in a unique way rather than just using options. (This adjustment strategy is taught in this video course - click here)

This adjustment technique can be used with managing iron condor trades and calendar spread trades as well.

Following find a screen grab of the risk graph right before this ‘Theta Scalped’ trade was closed out…

Go Here to get the Free Iron Condor Weekly Email Report.

Also, take a look at butterfly spread

Disclaimer Earnings Disclaimers Terms of Service Privacy Policy

Iron Condor / Butterfly Spread Trade closed for May 09 is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: adjust iron condor, Iron Condor, iron condor adjustment, iron condor spread, iron condor strategy

Related Iron Condor Info:

1. NEW OPTION TRADING VIDEO SHOW Learn to Manage and ADJUST Iron Condors -go to:...
2. *** THE FORGOTTEN OPTION TRADING STRATEGY *** Learn Iron Condor Trading Secrets - Check out this...
3. *** RUT JUN IRON CONDOR CLOSED ***  RUT IRON CONDOR - JUNE 09 - CLOSED  5-27-09...
4. *** SPY JUN BUTTERFLY - IRON CONDORS CLOSED *** SPY BUTTERFLY - JUNE 09 - CLOSED 6-15-09 6-15-09...
5. IRON CONDORS - RUT JULY IRON CONDOR - CLOSED  RUT IRON CONDORS - JULY 09 6-26-09 This month...

*** THE FORGOTTEN OPTION TRADING STRATEGY ***

Recently I found a great resource guide online that explains and breaks down a little known option trading strategy in really easy to follow step by step detail.

I had known about and even used this strategy over the years - but over the last couple of years I had put it on the back shelf - but after reading this guidebook I’ve found a renewed interest in this trade and will be starting to trade some of these.

To learn more join our free iron condors option trading newsletter Click Here

Disclaimer Earnings Disclaimers Terms of Service Privacy Policy

*** THE FORGOTTEN OPTION TRADING STRATEGY *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: adjust iron condor, Iron Condor, iron condor adjustment, iron condor spread, iron condor strategy

Related Iron Condor Info:

1. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...
2. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
3. ** GOOD IRON CONDOR / OPTION ‘ADJUSTMENT’ ARTICLE ** Iron Condor Training, Tools, and more - Click Here...
4. NEW OPTION TRADING VIDEO SHOW Learn to Manage and ADJUST Iron Condors -go to:...
5. – 2 New Iron Condor / Option Trading Strategy Videos – – 2 New Iron Condor / Option Trading Strategy...

*** NEW OPTIONS TRADING VIDEO PROGRAM ***

Great new weekly options video program produced by floor traders called Strategy of the Week. Every week a market maker explains, discusses, and trains a new option trading strategy, such as calendar spread, butterfly spread, iron condor, covered call, and more. This is a great and informative new show and like all the others - it’s FREE.

For more info on where to find this sign up for our free newsletter… Click Here

Disclaimer Earnings Disclaimers Terms of Service Privacy Policy

NEW OPTION TRADING VIDEO SHOW is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: adjust iron condor, Iron Condor, iron condor adjustment, iron condor spread, iron condor strategy

Related Iron Condor Info:

1. *** IRON CONDOR - PRACTICAL APPLICATION CLASS *** In this weeks Iron Condor Option Free Newsletter… * ...
2. *** GREAT NEW OPTIONS TRADING VIDEO COURSE *** Go Here to get our Free Iron Condor Weekly...
3. *** THE FORGOTTEN OPTION TRADING STRATEGY *** Learn Iron Condor Trading Secrets - Check out this...
4. Iron Condor / Butterfly Spread Trade closed for May 09 Last expiration cycle a new adjusting technique used to...
5. *** RUT JUN IRON CONDOR CLOSED ***  RUT IRON CONDOR - JUNE 09 - CLOSED  5-27-09...

*** A NEW OPTION STRATEGY for VOLATILE MARKETS ***

A few newsletters back we showed the ‘V-Spread’ - a new Iron Condor related option trade perfect for volatile markets. If you missed it you can read more by joining our newsletter by Clicking Here

This last month we put on another ‘DIFFERENT’ sample strategy trade that can work great in these wild swinging markets.

To learn more join our iron condor email newsletter by Clicking Here

How To Trade, Manage, and ADJUST Iron Condors - TRAINING COURSE is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. Iron Condor Iron Condor: How To Place, Manage, and Adjust Iron...
2. *** Join Us For LIVE Iron Condor WEBINAR *** *** JOIN US THIS THURSDAY for a FREE Iron...
3. *** IRON CONDOR - Geoffs Christmas Trading Video *** New Iron Condor Course, Video Training, Tools, and more...
4. *** THE HOLY GRAIL OF OPTIONS TRADING? *** *** Is There Actually Such A Thing As A...
5. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...

New Iron Condor Training, Tools, Webinars, and more - Click Here

Feb. was a good month for our Iron Condor
trade.

Although our new March trades aren’t in any
trouble yet - the market is currently in sort of
a precarious position - causing us to be extra
cautious.

Join our free iron condor newsletter by going here

*** Feb Iron Condor Expiration *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** Join Us For LIVE Iron Condor WEBINAR *** *** JOIN US THIS THURSDAY for a FREE Iron...
2. *** GREAT NEW OPTIONS TRADING VIDEO COURSE *** Go Here to get our Free Iron Condor Weekly...
3. Iron Condor An option selling strategy that has gained a lot...
4. Vertical Spread At the core of the iron condor strategy is...
5. Option Spread Trading Several different option spread trading strategies which investors can...

*** IRON CONDOR / OPTIONS WEBINAR REPLAY ***

There was a great options trading webinar this
last week and if you missed it you can catch a
f.r.e.e replay of it.

For more info join our free newsletter by Clicking Here

*** IRON CONDOR OPTIONS TRADING WEBINAR REPLAY *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** Join Us For LIVE Iron Condor WEBINAR *** *** JOIN US THIS THURSDAY for a FREE Iron...
2. *** GREAT NEW OPTIONS TRADING VIDEO COURSE *** Go Here to get our Free Iron Condor Weekly...
3. *** FREE TRADING VIDEOS *** Iron Condor Training, Tools, and more - Click Here...
4. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
5. – 2 New Iron Condor / Option Trading Strategy Videos – – 2 New Iron Condor / Option Trading Strategy...

*** Is There Actually Such A Thing As A Win-Win Trade? ***

*** HEARD OF THE ‘3 LEGGED BOX’ TRADE? ***

VIDEO: Here is a really interesting options trading video on an option strategy called the 3 leg box.

To learn more join our free iron condor options trading newsletter by Clicking Here - and receive free Iron Condor Training, Tools, access to Webinars, and more. To get the Free Iron Condor Weekly Email Report - Click Here

*** THE HOLY GRAIL OF OPTIONS TRADING? *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** IRON CONDOR - Geoffs Christmas Trading Video *** New Iron Condor Course, Video Training, Tools, and more...
2. *** GREAT NEW OPTIONS TRADING VIDEO COURSE *** Go Here to get our Free Iron Condor Weekly...
3. *** IRON CONDOR OPTIONS TRADING WEBINAR REPLAY *** Iron Condor Video Training, Tools, Webinars, and more -...
4. *NEW* Live Option Trading Lab I just found out that these Option Trainers are...
5. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...

Good new article resource on various ways to win on option positions
even when your wrong..

Click Here to join our online options trading newsletter and learn more.

- ALSO -

*** MODERN DAY NOAH? ***

Here’s a great video someone sent me this past
week on Peter Schiff.

This footage was shot several years ago - and
watching some of the so- called ‘gurus’ rolling
their eyes and laughing at Peters predictions is
surreal…

Click Here to join our Iron Condor newsletter and
learn more.

** GOOD IRON CONDOR / OPTION ‘ADJUSTMENT’ ARTICLE ** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** IRON CONDOR SUPERTRADER INTERVIEW *** New Iron Condor Training, Tools, and more - Click...
2. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
3. *** IRON CONDOR - Geoffs Christmas Trading Video *** New Iron Condor Course, Video Training, Tools, and more...
4. – 2 New Iron Condor / Option Trading Strategy Videos – – 2 New Iron Condor / Option Trading Strategy...
5. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...

Iron Condor Video Training Course, Tools, Webinars, and more - Click Here

Go Here to get the Free Iron Condor Weekly Email Report.

*** MORE IRON CONDOR / BUTTERFLY TRADES COOKING ***

After closing out last weeks Iron Condor Butterfly trades, we put on some new ones this week…

If you’re interested in learning more about how we trade these things be sure to join the list for our new upcoming butterfly trading newsletter by clicking here

CRASH PROTECTION For IRON CONDOR TRADES

Oct 08 was the closest thing many newer Iron Condor traders have experienced first hand to a crash - and the graphic in this weeks newsletter shows a ‘Crash Protected’ Iron Condor and how it performed during that crash.

This trade is a version of the Iron Condor which is used during periods of high volatility. Had this Iron Condor trade been put on in the traditional manner - it most likely would have gotten creamed as the crash occurred…

To learn more please join our free iron condor newsletter by Clicking Here

*** MORE IRON CONDOR / BUTTERFLY TRADES SOARING *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Option Strategy

Related Iron Condor Info:

1. ** Dipping Our Iron Condor Toe Back In The Water ** Iron Condor Video Training, Tools, and more - Click...
2. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
3. *** THE HOLY GRAIL OF OPTIONS TRADING? *** *** Is There Actually Such A Thing As A...
4. How To Trade, Manage, and ADJUST Iron Condors - TRAINING COURSE How To Trade and ADJUST Iron Condors - TRAINING...
5. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...

New Iron Condor Course, Video Training, Tools, and more - Click Here

*** IRON CONDORS - Geoffs Christmas Trading Video ***

This year instead of sending out a cheesy Merry Christmas email
Geoff prepared an early Iron Condor Christmas gift / video.

It’s a FREE video that will teach you what he does and how he profits
around earnings.

Click Here to join our newsletter and learn more.

This isnt specifically about trading Iron Condors or Credit Spreads - at
earnings time there are too many unpredictable forces operating.

However, he does have a strategy that he employs on stocks that have
a tendency to gap or move big during those times.

This new Iron Condor ‘related’ strategy can add enormous benefit to YOU and your
trading account for 2009.

Click Here to join our email newsletter and learn more.

*** IRON CONDOR - Geoffs Christmas Trading Video *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** GREAT NEW OPTIONS TRADING VIDEO COURSE *** Go Here to get our Free Iron Condor Weekly...
2. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
3. *** THE HOLY GRAIL OF OPTIONS TRADING? *** *** Is There Actually Such A Thing As A...
4. – 2 New Iron Condor / Option Trading Strategy Videos – – 2 New Iron Condor / Option Trading Strategy...
5. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...

*** NEW COVERED WRITE STRATEGY ***

Good new video link on how to do
a covered write trade…

Click Here to to join our newsletter and learn more…

*********************************************

*** NEW *LIVE* TRADING VIDEOS ***

Bill just added these short live trading videos showing
how he makes between $60 to $150 daily in 10 minutes
during his ‘lunch hour’ - using a very simple strategy
with very little risk.

Join our newsletter and check these out…Click Here

*** NEW IRON CONDOR - COVERED WRITE STRATEGY *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** FREE TRADING VIDEOS *** Iron Condor Training, Tools, and more - Click Here...
2. ** Dipping Our Iron Condor Toe Back In The Water ** Iron Condor Video Training, Tools, and more - Click...
3. – 2 New Iron Condor / Option Trading Strategy Videos – – 2 New Iron Condor / Option Trading Strategy...
4. Vertical Spread At the core of the iron condor strategy is...
5. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...

This month we decided to dip our Iron Condor toe back in
the water with our Monthly Butterfly Trades (similar to Iron
Condor Trades - except maybe better!)

- ALSO -

Dont miss Bills daily live trading videos, or the
featured Covered Write Video - and the Iron Condor Xmas
Video link found by clicking the link below…

To subscribe to our Iron Condor newsletter for Free, go here

** Dipping Our Iron Condor Toe Back In The Water ** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** GREAT NEW OPTIONS TRADING VIDEO COURSE *** Go Here to get our Free Iron Condor Weekly...
2. *** FREE TRADING VIDEOS *** Iron Condor Training, Tools, and more - Click Here...
3. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
4. – 2 New Iron Condor / Option Trading Strategy Videos – – 2 New Iron Condor / Option Trading Strategy...
5. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...

*** IRON CONDOR SUPERTRADER INTERVIEW ***

Excellent new article / interview from a
successful 62 year old retail Iron Condor
trader - and how he trades, manages, adjusts…

For more info on this article Click Here

Iron Condor Course, Video Training, Tools, and more - Go Here

*** IRON CONDOR SUPERTRADER INTERVIEW *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** FREE TRADING VIDEOS *** Iron Condor Training, Tools, and more - Click Here...
2. *** NEW IRON CONDOR VIDEO COURSE *** New Iron Condor Course, Video Training, Tools, and more...
3. ** GOOD IRON CONDOR / OPTION ‘ADJUSTMENT’ ARTICLE ** Iron Condor Training, Tools, and more - Click Here...
4. *** IRON CONDOR OPTIONS TRADING WEBINAR REPLAY *** Iron Condor Video Training, Tools, Webinars, and more -...
5. Vertical Spread At the core of the iron condor strategy is...

*** NEW IRON CONDOR VIDEO COURSE ***

Here is a new ‘option income course’ that is absolutely
worth the investment.

For more info Click Here

Includes training on new and unique ways to trade Iron
Condors, Calendars, as well as some more advanced
*Power Strategies* that are perfect for trading in these
turbulent stock market times.

For more info and to subscribe to our Iron Condor newsletter
for FREE - Click Here

*** NEW IRON CONDOR VIDEO COURSE *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** GREAT NEW OPTIONS TRADING VIDEO COURSE *** Go Here to get our Free Iron Condor Weekly...
2. *** IRON CONDOR SUPERTRADER INTERVIEW *** New Iron Condor Training, Tools, and more - Click...
3. ** Dipping Our Iron Condor Toe Back In The Water ** Iron Condor Video Training, Tools, and more - Click...
4. *** IRON CONDOR - Geoffs Christmas Trading Video *** New Iron Condor Course, Video Training, Tools, and more...
5. *** IRON CONDOR OPTIONS TRADING WEBINAR REPLAY *** Iron Condor Video Training, Tools, Webinars, and more -...

*** IRON CONDOR: GREAT NEW FREE TRADING VIDEOS! ***

There are some GREAT *NEW* FREE Trading Videos
up on the website for us to watch (absolutely no cost).

In particular, watch the one titled ‘Market
Wizard Insights’ by Jack Schwager. Also, ‘The
Art Of Morphing / Adjusting’ By Ron I.

These are really great - recommended.

To find out more and to  join our free newsletter Go Here

*** FREE TRADING VIDEOS *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** GREAT NEW OPTIONS TRADING VIDEO COURSE *** Go Here to get our Free Iron Condor Weekly...
2. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
3. *** IRON CONDOR OPTIONS TRADING WEBINAR REPLAY *** Iron Condor Video Training, Tools, Webinars, and more -...
4. – 2 New Iron Condor / Option Trading Strategy Videos – – 2 New Iron Condor / Option Trading Strategy...
5. *NEW* Live Option Trading Lab I just found out that these Option Trainers are...

*** GREAT NEW OPTIONS TRADING VIDEO COURSE ***

Good new Options Trading Online Video Course - Go Here

In particular be sure to check out Video Module called:
‘Advanced Techniques and Strategies’. This stuff is
perfect for trading in our current market environment.

To subscribe to our Iron Condor newsletter for Free, go here

*** GREAT NEW OPTIONS TRADING VIDEO COURSE *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** THE HOLY GRAIL OF OPTIONS TRADING? *** *** Is There Actually Such A Thing As A...
2. *** FREE TRADING VIDEOS *** Iron Condor Training, Tools, and more - Click Here...
3. *** IRON CONDOR - Geoffs Christmas Trading Video *** New Iron Condor Course, Video Training, Tools, and more...
4. *** IRON CONDOR OPTIONS TRADING WEBINAR REPLAY *** Iron Condor Video Training, Tools, Webinars, and more -...
5. Option Spread Trading Several different option spread trading strategies which investors can...

*** JOIN US THIS THURSDAY for a FREE Iron Condor Trading WEBINAR ***

Your invited to join us this Thursday for a free
online Iron Condor trading webinar.

Shown will be: “How To Profit From The Markets Current
Extreme Volatility Using Iron Condors and Simple Credit
Spread Strategies”

Space is limited and spots fill fast so please reserve
your spot now - go here
To join our FREE Iron Condor / Option Income Strategy Online Newsletter go here

*** Join Us For LIVE Iron Condor WEBINAR *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, credit spead, Iron Condor, Options Trading System, Vertical Spread

Related Iron Condor Info:

1. *** GREAT NEW OPTIONS TRADING VIDEO COURSE *** Go Here to get our Free Iron Condor Weekly...
2. *** NEW IRON CONDOR - COVERED WRITE STRATEGY *** Go Here to get the Free Iron Condor Weekly...
3. ** GOOD IRON CONDOR / OPTION ‘ADJUSTMENT’ ARTICLE ** Iron Condor Training, Tools, and more - Click Here...
4. *** IRON CONDOR OPTIONS TRADING WEBINAR REPLAY *** Iron Condor Video Training, Tools, Webinars, and more -...
5. *NEW* Live Option Trading Lab I just found out that these Option Trainers are...

*** IRON CONDOR - EERIE STOCK MARKET PREDICTION ***

This week we revisited an old posting that we
shared here in this newsletter last June.

The following blurb was taken from the June 21,
2008 weekend report. Be sure to take a look at
the levels predicted compared to where we are now.

Go Here to join our Free Iron Condor / Option Income Online Newsletter.

*** IRON CONDOR - EERIE STOCK MARKET PREDICTION *** is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: buttefly spread, Credit Spread, Iron Condor, Vertical Spread

Related Iron Condor Info:

1. *** Join Us For LIVE Iron Condor WEBINAR *** *** JOIN US THIS THURSDAY for a FREE Iron...
2. *** FREE TRADING VIDEOS *** Iron Condor Training, Tools, and more - Click Here...
3. *** NEW IRON CONDOR VIDEO COURSE *** New Iron Condor Course, Video Training, Tools, and more...
4. Iron Condor An option selling strategy that has gained a lot...
5. *** Weekly Option Trading Report *** ********************************************* —— OPTION *INCOME* VIDEOS —— Learn Option Income...

One thing that has always driven me nuts with
option trading education is the lack of basic
‘How To’ information. I have bought huge books
and lengthy courses that are full of ‘What is
a call’ type info - but very, very few ever had
anything ‘Practical’ I could actually use to
make money. It has always been very hard to find
information that would give me simple step by
step directions on how to actually make money
consistently with options.

In this weeks newsletter we look at one source
that actually did provide applicable info - plus we
include a list of several other option educator
resources that do deliver on their claims.

To subscribe to our Iron Condor newsletter for Free, go here

Iron Condor - Practical ‘How To’ Information You Can Actually Use is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, option trading tutorial, Vertical Spread

Related Iron Condor Info:

1. *** NEW IRON CONDOR VIDEO COURSE *** New Iron Condor Course, Video Training, Tools, and more...
2. *** IRON CONDOR OPTIONS TRADING WEBINAR REPLAY *** Iron Condor Video Training, Tools, Webinars, and more -...
3. *** IRON CONDOR - PRACTICAL APPLICATION CLASS *** In this weeks Iron Condor Option Free Newsletter… * ...
4. Option Selling Option selling has become more main stream recently as...
5. Option Spread Trading Several different option spread trading strategies which investors can...

Iron Condor: Following is an excerpt taken from the The Complete Iron Condor Strategy Guide E-Book …

IRON CONDOR: How To Know When It’s Time to Exit or Adjust

The Iron Condor Option Trading Strategy is a great trade.

Its simple to understand, easy to put on, has a high probability of success, kick off a great yield that can provide monthly income, and most of the time they work out beautifully.

MOST of the time.

The downside is that the Iron Condors Risk / Reward ratio is terrible - especially when compared with other option trading strategies.

Even though they DO work out just fine MOST of the time – all it takes is that ONE time to completely drain my account and put me out of the game for good.

That is, unless I know how and when to properly manage and adjust them.

There are different types of Iron Condors – each with their own different risk /reward ratios.

However, for illustration purposes, I will be using the main Iron Condor I use on a regular basis. Its what I call the ‘Plain Vanilla’ version of the Iron Condor.

Here it is:

10 point strike wings on an index vehicle, about one and a half standard deviations away from current price, between 30 and 50 days away from expiration. 80% or higher probability.

Now, using the above Iron Condor example – I could expect to take in a credit of around 1.00 on an average month. My risk would be 9.00.

Or, if I were to put on the above trade using 10 contracts, I would bring in a credit of around $1000.00 and be risking $9000.00

I am risking $9000.00 to make $1000.00

This risk to reward is terrible.

The above trade has around an 80% chance of success.

It should work out fine 8 times out of 10.

It’s the OTHER 2 times I need to be worried about.

Lets say I did the above iron condor for a total of 10 months – and I did absolutely NOTHING to manage or adjust. I just let the probabilities play out.

Heres what could happen…

I profit $1000.00 for 8 months.

$1000.00 X 8 = $8000.00 PROFIT.

Not bad. That’s almost a 100% return.

But then the other 2 months lets say I lose my max risk: $9000.00.

$9000.00 X 2 = 18000.00 LOSS

$8000.00 PROFIT – $18000.00 LOSS = 10,000.00 LOSS

Ouch!

Okay – lets say I don’t lose my max risk. Lets cut it in half.

Lose $4500.00 X 2 = $9000.00 LOSS

$8000.00 PROFIT – $9000.00 LOSS = 1,000.00 LOSS

Obviously – in order for this option trading strategy to work, I need to have a plan to protect – and keep – the profits I generate during the 8 good months – from the losses that will occur (and they WILL occur, believe me) during the 2 months that will be bad.

So what is that plan?

I need to know how to properly manage / adjust.

But� FIRST – I need to know WHEN to adjust.

So when do I adjust?

Lets go back to those numbers…

If I win $1000.00 8 times out of ten – HOW MUCH can I afford to LOSE 2 times out of ten?

If I can afford – both financially and psychologically – to just go back to break even at the end of ten months of trading, then my answer would be around $4000.00 per trade.

I could afford to absorb a loss of $4000.00, 2 trades out of 10.

At the end of ten months, I could be back at square one.

I win $1000.00 8 times, I lose $4000.00 2 times = $0 PROFIT.

On the other hand, lets say I dont want to make any less then $5000.00 during a 10 month span – then the most I can afford to lose on a trade would be around $1500.00

I win $1000.00 8 times, I lose $1500.00 2 times = $5000.00 PROFIT

THIS makes much more sense to me.

In the above example, $1500.00 equals about 1 and 1/2� times my original credit – or my expected monthly profit for the 8 good months.

I find this a good gauge to work off of.

I may even tighten it up to 1 times my original credit. But NEVER more than 2 times my original credit.

Anything more than 2 times would cause me to risk losing too much for my total income goal - AND it would wind up taking me MORE than 2 winning months just to make up for the loss - which could be hard to deal with emotionally.

Anything less than 1 times my original credit, I feel I am not giving the trade enough room to breathe and do its thing.

What this does is change the Iron Condors terrible 9 to 1 Risk / Reward Ratio to a much more acceptable 2 to 1 – or 1 to 1 Ratio.

So – before I ever even put a trade on - I decide what that ratio - or max acceptable dollar loss number - will be.

I’ll call this my ‘Maximum Pain Number’. It’s the maximum amount of dollars I am willing to lose while in the trade. In the above example it was 1 1/2 of my orginal / average monthly credit intake - or $1500.00 Loss.

I believe most times this number wont be hit.

But when it does (and it eventually WILL, believe me) – that’s my cue its time to either get out of the trade entirely - or adjust.

AND ACTUALLY - if I’m going to adjust, I need to begin doing so BEFORE my maximum pain number is hit - to take into account slippage and in order to give the new ‘adjustment’ position some room to breathe. If I am going to adjust, I usually begin planning/doing so when I am just over 3/4 of the way to hitting my maximum pain number.

This way, by not letting my losses get out of control, I always know that worst case scenario (I take my Maximum Pain Number LOSS) - based on the probabilities - I should still be profitable at the end of ten months.

AND best case scenario (I successfully adjust) - I could pull out of a losing trade and make it profitable once more.

I feel this concept might be the MOST IMPORTANT part of the Iron Condor strategy to fully understand and follow - religiously.

I believe in a poor risk to reward yet high probability trade - like the 80% probability Iron Condor I do - if I can just keep my losses under control and NEVER allow them to exceed my Maximum Pain Number (in this example 1 to 2 times my average monthly credit intake) - in the long run I will be profitable.

I NEVER allow an Iron Condor Loss to exceed my predetermined MAXIMUM PAIN NUMBER!

Until next time, Good Trading!

Join our FREE Iron Condor / Option Income Trading Newsletter by going here

Iron Condor is a post from: Iron Condor - FREE Trading Videos

Technorati Tags: Butterfly Spread, Credit Spread, Iron Condor, Option Strategy, Vertical Spread

Related Iron Condor Info:

1. Iron Condor An option selling strategy that has gained a lot...
2. Vertical Spread At the core of the iron condor strategy is...
3. Option Spread Trading Several different option spread trading strategies which investors can...
4. MARCH 2010 BUTTERFLY - IRON CONDOR CLOSED Butterfly Spread Trade - March 2010 - RUT This...
5. Condor Spread - All Calls or Puts Similar to an iron condor spread trade, the Condor...