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RUT Iron Condor (Mar’07, Closed for 23.2% Profit)

Published on March 1, 2007

RUT Iron Condor (Mar’07, Closed for 23.2% Profit)

March 1, 2007

I closed my RUT Iron condor by buying back the BCS for $0.25. rut-march-bcs-closure.png 

I had already bought back my BPS for $0.20 that I had mentioned here. With this, the overall March RUT Iron condor yielded 23.2% for roughly 1 month holding.

My strategy of closing leg one after other as soon as it hits the exit criteria also paid very well and tested very well against the ups and down of the market. A simple yet powerful concept resulted in no need for adjustments or ju-jitsu.

My margins are freed and now I shall start looking for April income trades. As the volatility has risen, so is the premium and so is the Risk. It’s important to choose the trade carefully.

4 Comments

  • Avatar donaldkong says:

    Hi optionpundit,

    I jsut wanted to confirm that you said you made 23.2% profit
    by closing the march ic 760/750 put and 850/860 call for $0.20
    each

  • Avatar OptionPundit says:

    Thanks Donald for highlighting the via e-mail that forgot to mention originally in this post. The 23.2% profit is based on $2.25 (original credit)-$0.20(buy back BPS) -$0.25(buy back bcs) on $7.75 risk. That is $1.80/$7.75 per spread. So my 23.2% if for ORIGINAL TRADE.

    However, I had also opened another trade to benfit from uptrending market i.e. BPS 800/790 for $0.90-$0.95. When the market started to sell-off and BPS started to lose money, I decided to take the BPS off. It was taken off ranging from $2.80 to $3.20 per spread. That resulted in slight breakeven to someloss for OVERALL trade.

    Hope that clarifies the confusion.

  • Avatar David says:

    Hi,

    Could you share how do u determine your exit criteria ? Thanks in advance.

  • Avatar Rapheal says:

    Hi,
    How can you find such trade and your trading plan? Can you share with us? Is it a “time” driven or “event” driven? If “event”, what events are you looking at?
    Happy Trading

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