New Trade Entry : SPX Weekly Iron Condor for September cycle.
Below is the position entered a short while ago:
SPX Iron Condor Position Entered Thursday, September 12, 7 days prior to expiration. The Option Code for this cycle is SPX130921, expiring Friday, September 21.
SPX September Iron Condor position shortly after entry
Time of entry: 10:45 am. SPX price: 1,689.27
Call Spreads: -1720/+1730. Delta of short call .12 at time of entry
Put Spreads: -1650/+1640. Delta of short put -.12 at the time of entry
Credit received: $1.55
Maximum margin/risk is $845. Maximum risk is the width of the spread ($1,000 less credit received $155.
Target Gain: $116.25 (75% of credit received). This gain represents a 13.8% gain on actual margin
Maximum Loss: $155
Adjustment Trigger: If the delta of the short call or short put reaches entry delta +10 (in this case .21), roll out the threatened side 10 points. As outlined in the guidelines published on July 4, it is a trader's choice after adjusting to either add additional spreads at the new strikes to make up the difference in credit, or to just have a reduced target gain.
I am not entering or recommending a weekly credit spread for this week once again; I will be sitting on the sidelines with the exception of the Iron Condor. The FOMC meeting is next week, which will likely bring the long awaited for answer to the question of "taper, no taper". The Iron Condor gives a wider tent to withstand market movements, so I will hold the capital normally allocated to the credit spread in cash until next week. Remember, cash IS a position.
Trade updates will be posted as appropriate.
As always, stay keen on your risk management and trade carefully.