***Closed***SPY iron condor initiated on 25 Sep 2009
14 Oct: Close Call Spread
SPY (Standard & Poors Dep Rec) Iron Condor initiated on 25 Sep 2009
Trade Type: Low Probability, High Reward Iron Condor
Trade Summary
14 Oct 2009
SPY at 108.77 (+1.31)
2 days to expiration
Action: Close call spread.
Buy to close SPY Oct 107 Call
Sell to close SPY Oct 109 Call
For a net price of $1.33 debit or better. [All TOS autotrade participants were filled at $1.32 debit.]
Profit or Loss: -$38 per entry
Analysis
The market opens today with a rush of bulls and it looks like it is not going to stop for the time being. We were doing pretty good for this trade just yesterday but this bull run today spoils everything. Of course we’re aware of the earning reports, what we didn’t know is the results and the eventual market reaction. Too bad for us, the market likes the results.
The breakeven point on the upside for this trade is 107.94. The SPY is currently trading at 108.77. If the SPY stays at this level, this trade will lose $83 per entry. Closing the call spread today will cost us $133 per entry. This effectively lock in a loss of $38 per entry. This is definitely better than the $83 loss.
We’re not too sure how far this bull run can go. If the market continues to trade up for the coming days, it is very likely we’ll have to do the same to our other open position.
Guys, we’re on a losing streak here. We’re as disappointed at you are. Our accounts are losing money as much as yours. We are determined to break this unlucky streak! We may have suffered losses, the only consolation is that we managed to keep our losses small and manageable. Believe me, we yearn for good profits as much as you do. We trade the same trades as you. We’re working very hard here to minimize our losses and at the same time look out for new trades for Nov.
Good trading,
Gary
*****Trade History*****
25 Sep: Initiate Trade
SPY (Standard & Poors Dep Rec) Iron Condor initiated on 25 Sep 2009
Trade Type: Low Probability, High Reward Iron Condor
Trade Summary
25 Sep 2009
SPY at 104.22 (-0.80)
21 days to expiration
Action: Sell a new iron condor for Oct expiration.
Sell to open SPY Oct 107 Call
Buy to open SPY Oct 109 Call
Sell to open SPY Oct 101 Put
Buy to open SPY Oct 99 Put
For a net price of $0.94-0.95 credit or better. [All TOS autotrade participants were filled at $0.94 credit.]
Net margin required: $106 per entry
Analysis
This is our second trade for Oct. With the immediate outlook of the market rather uncertain, we feel that this iron condor offers us good potential returns with minimal risk. With only 21 days to expiration, we’re optimistic that this trade will be profitable.
This iron condor has a delta of -2.9 per entry. Our breakeven points are 107.94 on the up side and 100.06 on the downside. As of now,we have a 44.54% chance of being profitable.
If the market doesn’t show signs of extreme movements next week, we should be able to add in 1 or 2 more trades for Oct. We’ll be in touch.
Good trading and have a great weekend!
Gary
