Last Friday, I was hoping that the volatility would decrease after the expiration day, so I could close the remaining Put spread for a smaller loss, but I was proven wrong.
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| DAX on 24/07/2017. Source investing.com |
Overall, there is an accumulated 6,1% gain since the beginning of the year (DAX increased 5.0% in the same period).
Final trade results
| Type | Name | Open Date | Spot | Max Win | P/L |
| Put Spread | ODAX Sep 2017 11600/11200 | 28/06/2017 | 12550 | 178,50 € | 58,50 € |
| Call Spread | ODAX Sep 2017 13250/13700 | 28/06/2017 | 12550 | 198,50 € | 89,00 € |
| Call Spread | ODAX Sep 2017 13000/13400 | 6/07/2017 | 12330 | 219,50 € | 131,00 € |
| Put Spread | ODAX Sep 2017 11900/11500 | 13/07/2017 | 12650 | 173,50 € | -260,00 € |
| Total | 18,50 € |
You can see all the trade details here.
It was a bad idea to redeploy the second call spread, as I could have closed the whole thing for a bigger profit and, more important, would have reduced the time on market to less than 10 days (compared to almost one month).
Risk of things happening during that time is much higher! At least, the account has not been wiped out, and we can keep playing for another expiration cycle.
See also
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ReplyDeletedo you have any way to simulate your iron condor before initiating a position?
ReplyDeletewhat is the margin needed to sell one iron condor?
See my comment below :)
DeleteHi! Thanks for your comment!
ReplyDeleteNormally, your broker of choice will provide you with a sort of "strategy builder" where you can see the profit/loss line moving while the price of the underlying moves.
There is also a couple of free simulators online where you can plan your trades:
Option Simulator:
https://www.optionseducation.org/tools/position_simulator.html
Options Creator (I like this better):
http://optioncreator.com/short-condor
For instance, this is an example of a trade that I´m preparing for December:
http://optioncreator.com/st5k36u
Regarding the margin for an Iron Condor, it depends on the broker but usually matches the trade maximum loss (that is the width of the wings minus the credit you receive). In case of the ODAX you have to multiply everything by 5 (400 points width = 2000€ max loss).
Hope it helps!
Victor
i didn't like any of the 2 as you can not get the actual prices. if max lose is ~2000, what is the max gain?
ReplyDeleteWell, they give you an approximation, which its quite good if you give the proper volatility values for each entry. Of course, if what you want is precision, you should use your broker's tool with live data.
ReplyDeleteThe max win in this kind of trade is the premium you receive when you open it