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BookingAlpha Option Trading Advisory

Friday, January 24, 2020

March 2020 SPX Unbalanced Iron Condor

Trade Details:

3 March SPX 2985/2975 Credit Put spread @0.70 credit each
1 March SPX 3450/3460 Credit Call spread @1.20 credit

I went with a 3x1 ratio instead of the usual 4x1. Totally at my discretion. I feel it is not the right time to be overly exposed on the downside.

Net Credit: $330
Max Risk: $2,670
56 days to Exp.

Profit/Risk Profile

SPX Chart for future reference:

Trade Update - February 11, 2020

Closed Call side:
1 March SPX 3450/3460 Credit Call spread @2.60 debit

Original credit: 1.20
Net loss: $140

The Put side 2985/2975 (credit of $210) will remain.

Trade Update - February 19, 2020

Closed the Put side:
3 March SPX 2985/2975 Credit Put spread @0.15 debit each

Original credit: 0.70
Net gain: 0.55  x 3 = $165

Combining this profit with the earlier loss on the Call side we have a net +$25 winner (165 - 140)
Tiny winner, basically a scratch.

On a max risk of $2,670 this represents a +0.9% Return on Risk.

The entire position is now closed.

There were only 0.15 more to make in this position. $45 for 3 Credit Put spreads. With 29 days to expiration this means about $1.55 per day. However, I can now deploy an April position 8 weeks out, collecting about $350 which represents more than $6/day of potential profits. So, at this point it was better to close the March position and move on.

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