***Closed***SPY (Standard & Poors Dep Rec) Iron Condor initiated on 25 Feb 2009
17 Mar 2009
SPY (Standard & Poors Dep Rec) Iron Condor initiated on 25 Feb 2009
Trade Summary
SPY at 76.8(+0.95)
3 days to Mar expiration.
Buy SPY Mar 81 Call
Sell SPY Mar 83 Call
Buy SPY Mar 71 Put
Sell SPY Mar 69 Put
For a net price of $0.15-0.18 Debit or better.
Profit or Loss: +$77 per position.
Trade Analysis
We decided to close up this iron condor to lock in the profits at this moment because there is not much time premium left and in this anything goes market, saving $0.18 is not quite worth the risk.
We are rather happy with this profitable trade despite a very challenging market condition for the past weeks. We still have another open trade for Mar expiration. Even though we made a loss on one of the trades we had on, it is still possible that we will need up profitable for the month.
We entered this trade on 25 Feb for $95 credit per entry. We are closing it today for $18 debit. That nets us a profit of $77 per entry on a margin of $105 dollars. This means that if you have invested $1050 for 10 entries, you would have profited $770. This translate to a profit of 73.33%!
Going forward, we will continue to trade lightly and for short periods in view of this volatile market.
We hope you have enjoyed trading and profiting alongside us. The market may present us with challenging times but we are confident that despite some losses, we will be able to stay positive in the long term.
Good trading,
Gary
************Trade History**************
25 Feb 2009
SPY (Standard & Poors Dep Rec) Iron Condor initiated on 25 Feb 2009
Trade Summary
SPY at 76.33 (-1.13)
23 days to Mar expiration.
Sell SPY Mar 81 Call
Buy SPY Mar 83 Call
Sell SPY Mar 71 Put
Buy SPY Mar 69 Put
For a net price of $0.95-0.96 Credit or better.
Net margin required: $105 per position.
Trade Analysis
This is only our second trade for March with only 23 days to expiration. Needless for me to say, the market remains bearish and volatile. We again would urge subscribers to trade lightly.
For this iron condor, we are risking $105 to make $95 for every entry. This gives us a risk/reward ratio (R3) of 1.11. This means we are risking $1.11 to make $1.
Our breakeven points are 81.95 on the upside and 70.05 on the downside. As you can see from the P&L chart below, we have 48.91% probability of success with this trade.
Technically, the market is oversold. However, do note that an oversold market can become even more oversold before we can see a relief. We may be on the way to a new low or we may be ripe for a bounce soon. As it is, this current environment is difficult to trade, directional as well as neutral. As such, we will try to close our positions to lock in profits as soon as possible.
Good trading,
Gary
Founder, Head Trader of MarketNeutralOptions
www.MarketNeutralOptions.com
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