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Iron Condor Options Strategy (TUTORIAL + Trade Examples)
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5 жыл бұрын✅ New to options trading? Master the essential options trading concepts with the FREE Options Trading for Beginners PDF and email course: geni.us/options-trading-pdf
💰 Get up to $3,000 when you open and fund your first tastytrade brokerage account: geni.us/tastytrade
🔥 Learn data-driven options strategies: optionsforbeginners.teachable...
💻 Maximize your trading with TrendSpider's advanced charting tools and scanners: geni.us/trendspider
➥ Iron Condor Setups PDF: www.dropbox.com/s/pe3uzynwk7u...
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The iron condor options strategy is one of the most popular options trading strategies, especially among traders who prefer selling options with limited risk and want a neutral market outlook.
Selling iron condors (referred to as a "short iron condor")is a market-neutral strategy that profits when the stock price remains within a range, which makes it a high probability trading strategy that requires no predictions in regards to which way the stock price will move.
A short iron condor is constructed by selling a call spread and selling a put spread simultaneously.
Since selling a call spread is a bearish strategy (profits when the stock price remains below the call spread) and selling a put spread is a bullish strategy (profits when the stock price remains above the put spread), combining the two into a short iron condor results in a neutral position (no directional bias).
In this video, we'll cover:
- Selling iron condors explained (setup, explanation, max profit potential, max loss potential, breakevens)
- Historical trade examples so you can see exactly how the iron condor strategy performs in various scenarios.
- A demonstration of setting up an iron condor on the tastyworks trading platform. I even put the trade on and take it off so you can see how easy it is to get in and out of iron condor positions.
- How buying iron condors works.
Be sure to leave a comment down below with any questions you may have! tastytrade, Inc. (“tastytrade”) has entered into a Marketing Agreement with Project Finance(Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’ brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade and/or any of its affiliated companies. Neither tastytrade nor any of its affiliated companies is responsible for the privacy practices of Marketing Agent or this website. tastytrade does not warrant the accuracy or content of the products or services offered by Marketing Agent or this website. Marketing Agent is independent and is not an affiliate of tastytrade.
@projectfinance 5 жыл бұрын
✅ New to options trading? Master the essential options trading concepts with the FREE Options Trading for Beginners PDF and email course: geni.us/options-trading-pdf And yes, I am FULLY aware that I took a loss on that iron condor trade to demonstrate entry/exit for you guys. Hope you enjoy the video! :) -Chris
@lawrenceyi 5 жыл бұрын
projectoption trying to understand, you took a loss because you sold the iron condor for $1.08 but bought it again for $1.12. Does that mean a loss of $4 + commissions?
@projectfinance 5 жыл бұрын
@@lawrenceyi That's correct! $4 loss plus commissions/fees.
@dasnova101 4 жыл бұрын
@@projectfinance wonderful video. I can increase the quantity of the Iron Condor? say i want to buy 5 Iron Condor on a single trade?
@shankar4005 3 жыл бұрын
Great job at explanation and the visualisations. Cheers Chris.
@jamesgalloway4968 3 жыл бұрын
This is by far the best explanation of the short Iron Condor thank you very much for the information. You are terrific at teaching trading strategies.
@michaelwu4848 3 жыл бұрын
I watched six videos (learned a lot from every single one), and the Iron Condor Options Strategy is by far the best one. The way you lay out the examples and calculations is very clear and easy to understand. I hope you follow this video's "template" in the future.
@mahendrarathore4833 4 жыл бұрын
Superb fusion of passion, quality production, great illustrations and perfect delivery. Keep going Chris, Sky is the only limit for you.
@projectfinance 4 жыл бұрын
Much appreciated! I really need to remake this video. It could be way better (like my newest videos)! Thanks for watching/commenting.
@mahendrarathore4833 4 жыл бұрын
Hi Chris, I hope you will someday do a video on practical applications of the Skews in option trading. You did an outstanding video on Skews that was highly rated. As an extension it would be great to have follow on the application of skews on your platform. Just a humble request. Thanks for serving the humanity in this regard. Best Wishes for continued successes.
@heavenbound78 4 жыл бұрын
great video, just learning about types of strategies, I really liked this with a higher probability ratio, thanks again and thanks for the .pdf
@smhaceofspades2813 3 жыл бұрын
OMG I've needed this so much THANK YOU!!!!I've been mind numbing myself through E books and it's Greek this is refreshing.
@ebeaulieu813 2 жыл бұрын
Well done explanation. You went a lot further then most with explanation of the risk/reward also. Thanks.
@ghreiskhaleq5165 4 жыл бұрын
Thank so much chris . I have joint SMB capital options for a premium . but they come no where near your lectures and easy explanation. as a matter of fact i watch your video first before i go to their videos. your are master trader indeed.
@rogerfesta_ 5 жыл бұрын
So helpful! Great production quality by the way. I often put videos like this on in the background but I was engaged the whole way through!
@projectfinance 5 жыл бұрын
Roger! Thank you so much for the comment/feedback! I really appreciate it! :D -Chris
@Brandonweisinger 3 жыл бұрын
Ditto! I do the same thing! (LoL!) However, I DID decide to stop everything that I was already semi-busy doing at the time, and take out my spiral notebook to jot down a few things once he got into the ‘real world application’ of the trade on the tastyworks platform! (Cuz I happened to of just opened an acct with TWs and’ve been thinking it’s UI is a lil’ too confusing for me!) So I wanted to see him make trade using that platform! BUT MOSTLY, bcuz this is the ONLY vid, so far, that I’ve seen anyone (ever) talk about the Greeks before, of an iron condor trade and what kinda delta one would want when utilizing/entering this trade strategy! So, kudo’s to you for that bro! 🤞🏼I’m really hoping that u give+explain in detail, all of the greeks in the rest of ur option strategy videos as well!🤞🏼i guess we’ll see w/e I check ‘em out after this! 🤘🏼Thnks again bro!🤘🏿 ✌🏼✌🏿
@samdds 4 жыл бұрын
Thank you very much this. I found it very helpful. Great presentation and production quality.
@yodo7571 5 жыл бұрын
Well put together video, with excellent examples, step-by-step instructions and great explanations!
@projectfinance 5 жыл бұрын
Thank you!
@cindydu8644 4 жыл бұрын
Love the video! I was doing the math and noticed at @, the lower bound should actually be 117.47 I believe, instead of 117.43! Insignificant difference, but the OCD in me... Anyways, thanks for the explanation! It really helps!
@Po101080 3 жыл бұрын
Extremely well taught - thank you!
@markburton9712 3 жыл бұрын
Ta mate. I'm really chuffed with the free PDF. Have a cracking day! God bless.
@alexanderfrost2943 3 жыл бұрын
Thank you very much Chris. That was really helpful.
@taylorcollins4060 3 жыл бұрын
I just held eye contact with you for 10 min. You did not blink once. Lol. Great video. Love
@dalvi_ 3 жыл бұрын
2:27
@kevino4846 2 ай бұрын
;-D I noticed that, too. That's a skill.
@olutoyin7602 4 жыл бұрын
As always, very detailed and concise video. Would you agree that long iron condors is more suitable with a high volatile stock.
@kevs8891 3 жыл бұрын
Thank you, Chris. This video is much appreciated.
@patrickduc491 4 жыл бұрын
Thanks Chris for this very nice tutorial. Your tutorials are really worth watching. Also, I appreciate the fact that the information you provide are very honest and wise. Keep on with this excellent job !
@projectfinance 4 жыл бұрын
Thanks for watching/commenting! I'm glad the videos have been helpful.
@petrophysics4435 5 жыл бұрын
Chris, you are the best, most succint and pertinent guy for a beginner to learn about trading options - big thanks! (Miss your hair though..)
@projectfinance 5 жыл бұрын
Thanks, Mark! I appreciate it. Haha I can still grow my hair out but I choose to shave it.
@seitwenwei9430 3 жыл бұрын
Hi Sir, a few questions on using Iron Fly/Condor; 1) Do I need to own stocks to sell and cash to buy stocks should my sell call or sell put are exercised? 2) From the TOS Order Confirmation - Max Loss, the amount indicated in the max loss covers the loss for sell call/sell put exercised before expiration? Thanks!
@ralphaelconfer9719 3 жыл бұрын
Glad I found you. I'm a newbie. Where should I start. I like the way condors work as well as some strangles or should I start more simply.
@starlu4243 4 жыл бұрын
Your video is great! Explained everything in a way easily understood. I am wondering if you could explain the diagonal spread. I am searching on the web, there's a lot, but not as good as yours. Looking forward to your updates. Lol.
@projectfinance 4 жыл бұрын
Thank you for watching and commenting on my video! I appreciate the feedback/support.
@239karan 3 жыл бұрын
Great explanation. Makes a lot of sense
@maintaintogrow 3 жыл бұрын
This is solid stuff. Much appreciated.
@Jay_in_Japan 2 жыл бұрын
Thank you for the incredibly useful content you put out! It's really helpful, you explain things well. Also your head is perfectly shaped
@projectfinance 2 жыл бұрын
Haha thank you!
@Gustavo-bi4hv 3 жыл бұрын
Do you recommend we wait until expiration or close to expiration? Or should we close the trade way before this? Like when achieve 50% profit etc ?
@teoduh7538 3 жыл бұрын
Very new to options trading, but can you do an inverse iron condor? Say if you are anticipating a major catalyst which would cause the stock price to either drop or rise by a lot.
@Robert-di3kv Жыл бұрын
Outstanding job, thank you 🙏
@drewgibson4233 4 жыл бұрын
Best option's channel on KZfaq.
@projectfinance 4 жыл бұрын
Thank you so much! I appreciate the comment.
@LMF-ct4lt 3 ай бұрын
Another great video Chris. Do you use the Tasty Trade method of closing when 21 dte is left on the trade in most cases?
@izhanrahimi5477 4 жыл бұрын
Thank you for the explaination!
@projectfinance 4 жыл бұрын
You're welcome!
@CR250RidR Жыл бұрын
So you’re pretty much always safe (with in reason) after setting up your iron condor. If you have price alerts set up for the underlying letting you know if it’s getting too close to the break evens so you can just exit the trade completely?
@rsferim5 3 жыл бұрын
Hello, quick question feel free to refer me to a video you might have on the topic. Say I sell an Iron Condor on tastyworks. It starts going bad and is between the short put and the long put. The short put gets assigned. What does tastyworks do? Will I be holding 100 shares of the underlying and have the long put and short&long calls still open? Or will it automatically sell the shares and close the positions on the rest of the contracts? Thanks in advance
@perryberens618 2 жыл бұрын
Good video. Thanks for real time trade. That was very important on enter exit speed. Shows your experience is very good. I think I liked your choice in Broker software. I am just getting back into trading. Never traded option. I am currently with TD Ameritrade. Not sure I am in the right software. I will check your preference out.
@ddsindpls 3 жыл бұрын
I didn't fully appreciate the power of just selling options every week in order to just get consistent base hits, versus buying options and hoping for home runs all the time. It's better to have time decay as your ally, rather than your enemy.
@timothykerrigan597 Жыл бұрын
How do you sell options that don't get exercise on you?
@kalvinkearney4169 Жыл бұрын
@@timothykerrigan597 You have to sell options that you don’t expect to be in the money, or use OTM theta strategies like this if you expect sidewards movement. If you want to limit risk for selling naked options, use credit spreads. Otherwise, use covered calls or cash secured puts. There is no way to guarantee money. You are not always smarter than the market.
@kevino4846 2 ай бұрын
@@kalvinkearney4169 Your last sentence should be used in any lesson on markets.
@jamesrue3596 3 жыл бұрын
Hey Chris, My question 1st question is about closing the iron condor vs letting it expire "worthless" I just watched your video on 30,000 loss, Being a beginner trader, I don't want to let my options expire. Is it hard to close Iron condors close to expiration because there worthless? I'd be trying to sell a put and call not in the money and buy back my short call and put. 2nd question- how do you close an iron condor on tasty works? one button? or each individual options
@marinawong8586 Жыл бұрын
If the stock has a wide swing during the period you invest, would you actually incur loss on both ends (ie swings above call strike and below put strike before expiry and option buyer exercised early)?
@piriyefyneface9867 2 жыл бұрын
In the event that the stock price is bearish, i.e its encroaching the lower breakeven stike price and you feel the stock price now has a bearish directional trend which will most likely hit your max loss, can you close the put positions only and leave the call positions to keep making profits?
@vaugenheimnughnrn8723 3 жыл бұрын
When youre selling a call you only profit at expiration if its below strike or is it like a short where you have to cover if it goes against you?
@juannymoney9901 3 жыл бұрын
In the first example when the stock dropped below the long put can you increase your profits by selling the long put
@tigran_novo 3 жыл бұрын
Thanks for the video, quick question , why you don't do example few days before expiration? Trying to make sense of it. Cant we do that iron condor few days before expiration so that we can predict price better?
@rayvickers3934 Жыл бұрын
Great video Chris! Your content is very well done and I love your channel! Question - There is always the option of selling the iron condor early if your suspect the price action will cross your break-even threshold thus preventing a loss correct?
@projectfinance Жыл бұрын
You can always close an option position before expiration. You could enter an iron condor and then close it seconds later if you wanted to. You may close the position for a loss though (and likely will if the stock makes a big move against you and you close the trade).
@bibarishs3120 3 жыл бұрын
Thank You💚
@hanmingchen3138 3 жыл бұрын
So at the expiration date of the iron condor option, what do you need to do? You simply sell it? Or just let it settle winces it’s worthless?
@ahmedmoheeb9298 3 жыл бұрын
Thanks Chris for an excellent tutorial. Question - should we hold the Iron Condor till expiration date, or we can exit earlier if we made profit?
@projectfinance 3 жыл бұрын
You can exit before expiration if you have a profit. You can always close options before expiration.
@mouadovic04 9 ай бұрын
Can we close all the trades just (after a couple of days 3 4 ) if the position are positive or we necessarily have to wait until the expiry
@SwordOfTheSpiritt 4 жыл бұрын
Thanks for these videos, I take notes along the way and learn a lot from them. One thing I think you should do differently is slow down your speaking and not cut out short pauses while your speaking since I'm sure lots of other people are also taking notes on these videos and it gets hard to keep track and process what you are explaining if you cut out the pauses when your speaking since it sounds like your talking nonstop without taking any breath, without letting the viewers process and take time to write down notes. Other than that, keep making videos on all the different option strategies, I've found them so helpful. I will definitely be sharing your channel with everyone else I know looking to get into trading options. In my opinion you're the best at explaining everything in as simple of terms as possible for people to understand, I walk away with a much better understanding after watching your videos than I do with anyone else on the internet. Also an idea I think would be pretty cool is if you created 3 playlists for your videos both already posted and for future videos as well, where you could put much more complicated options topics into an advanced options playlist, put videos with simpler but still hard topics into an intermediate playlist, then have a beginner playlist which is where you'd put videos explaining basics of options, expecting anyone watching a video in the beginner playlist is brand new to the world of options trading. Thanks again for providing so much, I honestly wouldn't know half of what I know when it comes to trading options if it weren't for your channel. Before I end off this comment, I have a few questions. I am 16 years old with a much smaller amount to trade with ($6000), what are a few of the options strategies you'd suggest I use being at age 16 and willing to take lots of risk since I have a lot to gain, but not much to lose. Also, what are your favorite high risk high reward strategies? And what ticker symbols do you usually trade these strategies with? You may see this same comment on multiple videos to insure i get a response, no need to respond to the same comment more than once.
@rajabalajee3722 2 жыл бұрын
GREAT teaching . I learnt a LOT Absolutely agree with the "slow down" your speaking observation . Alos, need to be less verbose. Use Visuals more effectively and CUT DOWN talking. IMO, too mcuh talking in this video. It distracts. Use a LINEAR "Spread" model and use colors to explain BE points and P&L.
@lleytonslaysman9031 4 жыл бұрын
Hi, I know this is an old video, and I may have missed the answer, but what happens if you make the contract for only 30 days per day?
@unmilpatel472 4 жыл бұрын
Great video and super informative. Can you please help me with this question for the Short Iron Condor? So the current stock price of MGM is $13.8. Hypothetically, I think that the stock will stay between $13.5 and $14.5. Price is as follows: In brackets - debit Buy Put at $12.5: ($20) Sell Put at $13.5: +$48 Sell Call at $14.5: +$32 Buy Call at $15.5: ($8) Total Credit - $52 (1) Let’s say, the stock price at expiration is at around $12.7 which is at a certain loss. Would you wait for the $13.5 Sell put option to be assigned or would you close the position by buying the Sell put option? (2) Let’s say the stock price at expiration is at $12.2 which is at max loss area. As it is In the money for both Sell Put $13.5 and Buy Put $12.5 options, how would you close these positions? Would Buy put $12.5 and Sell put $13.5 cancel each other out and we wouldn’t get assigned? Looking forward to your response.
@projectfinance 4 жыл бұрын
I'd close the trade before expiration by buying back the shorts and selling the longs. However, if the put spread is fully ITM, you might get assigned on the short put if the option has very little extrinsic, which will be the case if it has 1-2 days to expiration and a few dollars ITM. In that case, if you are assigned, you will have to close the long stock position if you run into margin issues with your brokerage, and then you'll want to also sell the long put for whatever it's worth.
@SureshP-ug1ei 3 жыл бұрын
Thank You Very Much
@54darcy 4 жыл бұрын
Hi Chris.. great video- thanks for putting these together. Question, if I want to create a scanner to find range bound stocks that will be a good for this strategy any ideas on what type of filters to use? if setting up the IC similar to how you describe then I want to find stocks that are going to stay within the range for the next 40 days approx. thanks again.
@drysabre2242 2 жыл бұрын
same
@beauchang4741 3 жыл бұрын
Lets say you want to enter this position and close it the same day. Would that be a total of 4 day trades or just one? Sorry new to this....
@shanthanalur4714 4 ай бұрын
I thought you mentioned fixing a losing trade, is there a way to go that ahead? Thanks
@vaughnbanks1167 4 жыл бұрын
If you own 100 shares of the stock you do the iron condor on, will the initial price paid be less?
@jaylamars8419 3 жыл бұрын
Can you use the strategy on any expiry or is 60 days the minimum?
@scottsmith4145 2 жыл бұрын
Both the short IC and long IC are symetrical....So what is it called if you sell a put spread and buy a call spread? Is it a type of hybrid iron condor, two separate vertical spreads or something else?
@fangquans Жыл бұрын
will a covered iron condor strategy be better? "covered" means cash reserved for selling put, and stocks covered for selling calls.
@fuleung4296 3 жыл бұрын
Ok very good info indeed
@billestep6804 3 жыл бұрын
So you have to have the collateral for the Max loss and the buying power for the net credit So with 10000 dollars I could put on 10 condors with $10 wide spread on cash account?
@abhilashmani1946 3 жыл бұрын
Hello, why we are giving 60 days of expiry, this will give chance for stock movement right? Is it a good way to go for shorter expiry days?
@kylebaggett3783 3 жыл бұрын
My issue with this strategy is that individuals can exercise their option. Do you know the percentage of options that get exercised?
@bi0lizard1 3 жыл бұрын
10:00 Your spread width was actually $40 not $30 correct? This would make the loss potential $2,835 not 1,835. Did you make a mistake or am I not understanding something? Just trying to make I understand this correctly. Excellent video. I’m learning a lot. Ty.
@rickphillips381 5 жыл бұрын
Loved the video and the production quality! What software do you use to create your videos?
@projectfinance 5 жыл бұрын
Thank you, Rick! I use Adobe Premiere and Adobe After Effects. -Chris
@bluewish5377 3 жыл бұрын
Can we close the iron condor anytime before expiration? what will happen if we did not close the iron condor trade before expiration
@yichalnegussie5401 2 жыл бұрын
I love you brother, you’re great
@ergonautilus Жыл бұрын
What about stop losses on iron condors? How do choose and execute them?
@braddeicide 6 ай бұрын
Do you only use European options? With American you could be assigned on both spreads if there's way more movement then expected?
@buzzkill7887 3 жыл бұрын
If anyone could help this would be great what if I setup on a iron condor with limited open interest. But I wait till expiration will I still get the premium at expiry
@jjseandxcefree 3 жыл бұрын
hi... I was looking at a condor of stock XXXX Oct 30 (sell the 400p x1 and buy the 300p x1, then sell the 500 cx2 and buy the 550c x2) x2) for about $34 credit. Now what happens if XXXX slips to 380 or 520 before oct 30 - do one of my legs get exercised...and if so what do i do to manage the trade? thanks
@VangieTay 2 жыл бұрын
Great tips, thank you Projectfinace, I just subscribed too.
@dillySix9 3 жыл бұрын
Great video. I’m still confused on something. I am brand new to trading, so this probably sounds like a dumb question. In your examples you first sell a put and call option. Assuming you have to “own” those positions first right? Would you purchase those positions with the the intention to selling right away, so the expiration date should be a short amount of time?
@zrolo6329 3 жыл бұрын
You can sell options the same way you can sell stocks. You are selling it to buy it back later, read up on short positions.
@tonydavar7303 4 жыл бұрын
best channel in the youtube
@projectfinance 4 жыл бұрын
Thank you so much! I appreciate the comment.
@trade_iv 4 жыл бұрын
So in the first example both sold options were the higher ones, in the example you did the higher stock costs the same but the lowers you sold the lower number instead of the higher one..why?
@lleytonslaysman9031 4 жыл бұрын
Hi, I’m trying to buy an iron condor right now in think or swim but it won’t allow me without buying shares? Am I doing something wrong?
@serenityhope1138 3 жыл бұрын
Can you allow the iron condor to expire without closing the trade
@prestonwhite2604 3 жыл бұрын
When you say the max loss potential is about 1,800 does that mean that you can lose more than you put in? Or does it expire as no capital gain?
@devanshrathore9112 2 жыл бұрын
Of course you can lose more than what you put in. That is almost always the case when selling options.
@johnhang4315 2 жыл бұрын
how much of cash position do we need to have to enter this iron condor trade?
@markc5771 Жыл бұрын
If you were up on certain wings, would you ever close wings out without closing the entire thing out?
@arnisdaddy7905 3 жыл бұрын
Wish you would do this same tutorial on Think or Swim platform.
@deepsingh-vl6kp 3 жыл бұрын
what if the PUT will get exercised before expiration?
@rakgenius100 2 жыл бұрын
when will I be credited as soon as I make iron condor transaction? In tasty works, it showed as 1.35 cr but I dont see that money yet in ny account.. will i get it after I close it?
@BrezHurley 4 жыл бұрын
You're a good teacher. Lessons are crystal clear :)
@UmaMahesh-wu1jm 4 жыл бұрын
Grate job
@projectfinance 4 жыл бұрын
Thank you!
@serenityhope1138 3 жыл бұрын
What's the difference between buying and selling iron condor
@TheOriginalPickleRick 2 ай бұрын
You can still get assigned if the price finishes between the Calls or the Puts.
@anthonypayne4685 5 жыл бұрын
Great videos! Why can’t you do this with one week options?
@diverdown81 5 жыл бұрын
You can, but the premium isn't really there for options that are close to expiration. You max profit after commissions would be low. I would generally just sell a strangle or naked put on weeklys.
@dariusstefanliciu1610 29 күн бұрын
Is the same happening if the trade expiration time is 0DTE?
@davidsiwek994 Жыл бұрын
Hi , nice video, I did not find then mentionned pdf though
@projectfinance Жыл бұрын
www.dropbox.com/s/pe3uzynwk7uy4e2/Iron-Condor-Trade-Setup-Tips.pdf?dl=0
@christianfiguroa7147 2 жыл бұрын
When would you use an Iron Condor I'm still learning about buying calls and puts and selling them. I'm like I thought it was just buy and sell.
@markc5771 Жыл бұрын
So you're betting on the time decay on this one?
@Dustin_Neal 4 жыл бұрын
Example IRON CONDOR/Question... 101 - buy call 100 -sell call 97 - STOCK PRICE 94 - sell put 93 - buy put If I have an iron condor set up like this, my collateral will be $100. If the stock price is between 100 and 101 at expiration, is it possible to lose more than my $100 collateral on the trade?
@projectfinance 4 жыл бұрын
Nope! If you collect a credit larger than one of the spread widths on the call or put side, then you have no risk on that side. You have a minimum profit on that side. For example, if you sold your example iron condor for $1.50, since your call spread is $1 wide, you'd have $50 of profit potential on the upside. If the stock price expired above the call spread, the call spread would be worth $1.00, but since you collected $1.50, you'd make the $0.50 difference. $0.50 option profit x 100 option contract multiplier = $50 profit on each iron condor.
@amg11901 Жыл бұрын
If you make an ic with in the money options, are you long volatility?
@projectfinance Жыл бұрын
If you buy an IC, you're technically long volatility when the stock price is in-between your long call and put. But if the stock moons or collapses and ends up beyond one of your spreads, the position will benefit from a collapse in volatility. I talk about this in my "vertical spreads for beginners" video in the section on vertical spreads vs. IV. I also talk about it in my "vertical spread concepts you need to know" video.
@ThePepperfly 3 жыл бұрын
At first, wondered what the result of getting out of that position was, but I can see from the comments that it was a loss. So... that leaves me to ask a few other questions. Why would you demonstrate getting into a position you didn't want in the first place? How is that useful to us that are watching this? What was the risk of staying in this position? Thanks in advance.
@durellperch1163 4 жыл бұрын
Good info. Is the link for the pdf software still in the description?
@durellperch1163 4 жыл бұрын
Found it, Thanks
@ryanmcfarquhar8983 2 жыл бұрын
Would it be wise to set up iron condors on Thursday before experation is you know the stock is not going to move much?
@projectfinance 2 жыл бұрын
You will not collect much premium and you'll need to choose really close strike prices. It would be very easy for the stock to move outside of your IC strikes. It's not as obvious of a trade as you might think. There are downsides.
@anandkulkarni2111 Жыл бұрын
Iron Condor = Strangle + Cover To protect unlimited seller risk ( The outer strikes of cheap OTM are the covers ).
@JAM3SY9 Жыл бұрын
Does Chris have to actually own the underlying stock in order to build these condors?
@projectfinance Жыл бұрын
You don't need to have any shares to trade iron condors.
@EviLTunG 4 жыл бұрын
The first example, if someone exercised the option when you were in the loss zone, wouldn't that ruin your whole setup and you'd make a loss?
@incredulofreeman8358 3 жыл бұрын
Im wondering the same thing, i don’t see why wouldn’t that happen unless those were European options, not sure.
@salomon5209 Жыл бұрын
Hey theoretically In American options, it is possible to lose on both sides with the Iron Condor strategy, right?
@projectfinance Жыл бұрын
Not if you hold to expiration because the stock price can't be above a higher price AND below a lower price simultaneously. Like if you sold the 100/105 put spread and the 125/130 call spread, the stock price can't be below $100 and above $130 at expiration. It's one or the other.