cwelsh 1,500 Report post Posted September 28, 2012 RUT currently at 840.10 I just sold the Nov monthly RUT 730/740/900/910 for $1.35. Target hold time 21-28 days, if the price stays right at 840, 28 days from now, it should be worth $0.30. If I can ever get a 7% return on margin (price to close .65), I'll be out. And no, this is not delta neutral either, there was some technical analysis, and general fears about a market collapse involved. And yes, it is outside a 2SD spread. Share this post Link to post Share on other sites
Hannes Kury 7 Report post Posted September 28, 2012 I am confused the title says RIC. Isn't it an IC? Share this post Link to post Share on other sites
xpresstalk 3 Report post Posted September 28, 2012 RUT currently at 840.10 I just sold the Nov monthly RUT 730/740/900/910 for $1.35. Target hold time 21-28 days, if the price stays right at 840, 28 days from now, it should be worth $0.30. If I can ever get a 7% return on margin (price to close .65), I'll be out. And no, this is not delta neutral either, there was some technical analysis, and general fears about a market collapse involved. And yes, it is outside a 2SD spread. I have been looking at a very similar trade. This is pretty conservative. I am joining you in this. Although, I have only got 1 contract filled so far. Share this post Link to post Share on other sites
cwelsh 1,500 Report post Posted September 28, 2012 It took about 2 hours for me to get a full fill -- and it's only as conservative as the markets let it Share this post Link to post Share on other sites
Guest listolyman Report post Posted September 28, 2012 RUT is at 841 now but the mid has dropped to 1.10 already. Share this post Link to post Share on other sites
jr1221 12 Report post Posted September 28, 2012 It sounds like Chris BOUGHT an Iron Condor, so received a credit. Had he SOLD it, it would have been an RIC and resulted in a debit. Share this post Link to post Share on other sites
cwelsh 1,500 Report post Posted September 28, 2012 I received a credit for the trade -- this just depends on how your trading platform names things, on TOS you sell IC's for credits Share this post Link to post Share on other sites
Hannes Kury 7 Report post Posted September 28, 2012 Chris, Thanks for sharing the trade. I am a rookie. I like the trade as an IC but the title says RIC. That must be an error. If not, well then I probably should not think about trading the idea. Hannes Share this post Link to post Share on other sites
xpresstalk 3 Report post Posted September 28, 2012 Chris, Thanks for sharing the trade. I am a rookie. I like the trade as an IC but the title says RIC. That must be an error. If not, well then I probably should not think about trading the idea. Hannes IC is what I used to trade exclusively before joining SO. Yes, this would meet the traditional definition of a Iron Condor. Share this post Link to post Share on other sites
Thaze 4 Report post Posted September 29, 2012 (edited) Forewarning, I know this may sound a bit "noobish", so please forgive me as I am still learning the condor trades. How did you calculate the value the option would be worth in 28 days from now assuming the price stays at the current range? I know its related to the greeks (obviously), but if its not too much to ask, could you write out the formula used at the time of the trade for myself and others to see? Also, how do you calculate the 2SD movements? Sorry for all the questions.Thanks Chris. Edited September 29, 2012 by Thaze Share this post Link to post Share on other sites
Kim 7,512 Report post Posted October 1, 2012 It's IC, not RIC - I fixed the title to prevent further confusion. Share this post Link to post Share on other sites
Rogers 263 Report post Posted October 4, 2012 I like this trade. I still believe that you can make IC trades in a low IV environment if you adhere to risk management principles and can adjust quickly if needed. Share this post Link to post Share on other sites
cwelsh 1,500 Report post Posted October 5, 2012 Forewarning, I know this may sound a bit "noobish", so please forgive me as I am still learning the condor trades. How did you calculate the value the option would be worth in 28 days from now assuming the price stays at the current range? I know its related to the greeks (obviously), but if its not too much to ask, could you write out the formula used at the time of the trade for myself and others to see? Also, how do you calculate the 2SD movements? Sorry for all the questions.Thanks Chris. The 2SD movement is (eventually) going to be a long column/post, that's fairly detailed. As for calculating option prices in the future there are two methods: 1. Option Calculator (the better way). I like the CBOE's but there are many (http://www.cboe.com/framed/IVolframed.aspx?content=http%3a%2f%2fcboe.ivolatility.com%2fcalc%2findex.j%3fcontract%3d2B727374-766B-4CE9-87DE-EF77AEEF4D51§ionName=SEC_TRADING_TOOLS&title=CBOE%20-%20IVolatility%20Services) 2. Or you can just go look at historical prices with 28 days left to get an approximation if IV levels are close to the same (I SOMETIMES do this when first glancing at a potential trade because it's quicker, but I never rely on it). 1 kowski06 reacted to this Share this post Link to post Share on other sites
cwelsh 1,500 Report post Posted October 9, 2012 You can (or could have today) exited this position today for about .85-.90, that's getting close to my exit point. Share this post Link to post Share on other sites
LloydC247 10 Report post Posted October 10, 2012 Chris, did you close this trade? Share this post Link to post Share on other sites
Guest listolyman Report post Posted October 11, 2012 In at 1.35 and out at .70. thanks Chris! Share this post Link to post Share on other sites
cwelsh 1,500 Report post Posted October 11, 2012 No not yet, might tomorrow Share this post Link to post Share on other sites
cwelsh 1,500 Report post Posted October 15, 2012 For those following this trade, I have a BTC order in at .55, and will adjust up to .60 to close today. I also closed by AAPL NOV IC for 1.70, a 9.5% gain today. Share this post Link to post Share on other sites
cwelsh 1,500 Report post Posted October 15, 2012 Out at .60 Original price was 1.27, so a 52.7% absolute return or 6.7% on margin (which is how you should calculate). Could I hold to next Monday to possibly increase this to around 8.5%, sure, but I hit my profit targets, so I'm out. Share this post Link to post Share on other sites
pgrace0154 0 Report post Posted October 18, 2012 Out at .50 Share this post Link to post Share on other sites
Guest listolyman Report post Posted October 22, 2012 Hi Chris, Are you considering a Dec rut ic? Share this post Link to post Share on other sites
Marco 221 Report post Posted October 23, 2012 a 80$ spaced (between the short strikes, short strikes have a little under 30 delta) Dec IC on RUT is at about 4.75 mid credit. Enough for me to put one on even though RVX might still go a bit higher and market come off a little more. But Chris is usually doing wider strikes. Share this post Link to post Share on other sites
