Posted by: Tyson Heyn | August 28, 2009

Addition to November 2009 SPY Long Iron Condor

Nov 2009 SPY Condor - Updated

Nov 2009 SPY Condor - Updated


One of the great benefits of net credit transactions such as the long iron condor is that time is on your side, even on weekends. Setting up a condor on Monday and waiting until Thursday offers the same advance of time decay as a Friday setup going into Monday. Personally, if I have a choice, I’ll take as much time decay as I can over the weekend when markets aren’t moving.

In light of that, I’ve added 21 lots on the put side of this condor (SWGWQ/SWGWN) for net credit of $0.57. ($2.36-$1.79) This helps to make me a little less delta negative while also boosting the long-term income potential of this trade. The attached chart is updated to reflect the new position.

UPDATED YIELDS:

Maximum yield on September 17 is 5% at 100, with a 37% chance of being profitable.

Maximum yield on October 9 is 27% at 101, with a 67% chance of being profitable.

Maximum yield on October 30 is 58% at 101.75, with a 72% chance of being profitable.

Maximum yield on November 21 (expiry) is 83% at 95-109, with a 72% chance of being profitable.

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