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Monday, March 13, 2017

April 2017 RUT Unbalanced Elephant

Trade Details:

20 RUT 1270/1260 Credit Put spreads 0.60 Credit ($1200)
8 RUT 1450/1460 Credit Call spreads 0.86 Credit ($688)

plus

2/24 IWM 129/146 Unbalanced Long Strangle (.78 debit for the 129 strike Put, .14 debit for the 146 strike Calls. Total debit paid: $492 )

Net Credit: $1396
Days to Expiration: 39

Very low volatility environment. The long Strangle portion of the Elephant acting as hedge, even though it eats into the overall credit received. It's simply time to lower expectations.

Profit picture:
(Click on image to enlarge)



A RUT Chart for future reference and self-study:
(Click on image to enlarge)

Trade Update - April 21, 2017

The entire Elephant reaches expiration.
Max profit of $1,396 achieved.

Technically the IWM Options that are part of this RUT Elephant, expire tomorrow and not today, but they will expire worthless anyway.


For details about the management of Unbalanced Elephant positions consider an LTOptions.com membership, where there is also material that discusses how to put this type of position in small accounts too.

Check out 2017 Track Record


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