Despite a spike in volatility of almost 10% Friday, our open position remains positive.
The VIX, CBOE's volatility index, increased by 1.40 points Friday, almost 10% from the previous close. All the uncertainty over the debt ceiling and looming government shutdown is creating fear in the market, causing the spike.
Our October IWM Iron Condor continues to churn along, although a pullback would be welcome.
IWM October Iron Condor:
IWM October Iron Condor as of the close Friday:
The position is currently +$11.97. IWM closed Friday at 106.62; just .03 higher than last Friday's close. The upside trigger for adjustment is at 108. The upside adjustment is to roll the threatened side 3 points, as outlined in the article posted on September 26. It is a trader's choice whether or not to move the put spreads up 3 points, which will help offset the cost of rolling out the calls if necessary. The current credit to roll up the put spreads to -101/+96 is .15, however, this will likely change depending on the market movement Monday. If it is necessary to roll up the call spreads, I will roll up the put spreads in my position.
I will post an update on this position next week. Looking ahead to the November monthly cycle, we will be entering a new IWM Iron Condor sometime the week of October 7. Also, as long as market conditions are suitable, we will also be looking at a new trade entry on Thursday, October 3, for the October 2 weekly cycle.
As always, stay keen on your risk management and trade carefully.