Sold August $RUT 1150/1160/1350/1360 unbalanced Iron Condor. 1.34 credit from Calls, 0.60 credit from Puts. Half size on Call side.— The Lazy Trader (@lazytrading) June 23, 2015
Buy 2 August RUT 1150 Put @4.35
Sell 2 August RUT 1160 Put @4.95
Sell 1 August RUT 1350 Call @4.10
Buy 1 August RUT 1360 Call @2.76
Credit: 1.34 from the Call side, 0.60 from the Put side X 2. Total: $254
Max Risk: $746 on the upside, $1746 on the downside.
Days to expiration: 58
Complying with one of my cardinal rules on this play: never obtain less than .60 credit on a 10 point wide Put spread and never less than 1.00 on a 10 point wide Call spread. This doesn't feel like the most comfortable position in the world right now due to the low VIX that makes me get closer to the price action of the instrument. But, as I have pointed out before, nobody knows when the VIX will go up. For all we know we could be in a low VIX environment for one more month, or two, or an entire year like 2013, who knows. So, just keep it small and have a solid defense plan in mind just in case things need a little help down the road.
Alternatively I could have gone with the 1370/1380 on the Call side for 0.60 credit and fully balanced Iron Condor. I just happen to prefer the higher credit on the Call side and then half position size. If an adjustment is needed I will use normal position size on the adjusted Calls further up, which will allow me to mitigate the losses.
Here's the chart of the RUT index after market close today, June 23, 2015 for my own future reference and self study:
(Click on image to enlarge)
July SPX 1935/1940/2220/2225 unbalanced Iron Condor
$220 credit, 91% probability of success with only 23 days to expiration. Very likely to expire worthless without any problems.
August RUT 1150/1160/1350/1360 unbalanced Iron Condor
The trade discussed in this article.
$254 credit, 75% probability of success and 58 days to expiration
Check out 2015 Track record
Weekend Portfolio Analysis (July 11, 2015)
Weekend Portfolio Analysis (July 18, 2015)
Weekend Portfolio Analysis (July 25, 2015)
Closed 1150/1160 Put side early for risk reduction (July 29, 2015)
Weekend Portfolio Analysis (August 2, 2015)
Weekend Portfolio Analysis (August 9, 2015)
Weekend Portfolio Analysis (August 16, 2015)