RUT December position is nearing adjustment trigger on the downside.
As of this writing, RUT is down over 10 points today. As outlined in my Weekend Update, the December open position will be adjusted if RUT retreats to close below 1160. A recap of the position and recommended adjustment is below:
SHORT RUT December 1170 Call.
LONG RUT December 1220 Call.
LONG RUT December 1170 Put.
LONG RUT December 1120 Put.
Net Credit (all four legs): $30.67
Extra LONG RUT December 1250 Call.
Net Debit: $.75
Adjustment made on November 24:
BOUGHT RUT December 1170 Call
SOLD RUT December 1220 Call.
SOLD RUT December 1190 Call.
BOUGHT RUT December 1240 Call.
Net Debit (all four legs): $8.88
Below is the current position:
RUT December Iron Butterfly:
The guidelines call for the threatened side to be rolled 20 points. This can be accomplished with one order: "BUY Condor"; in this case all Puts.
The adjustment would be:
BUY RUT December 1170 Put.
SELL RUT December 1120 Put.
SELL RUT December 1150 Put.
BUY RUT December 1100 Put.
The adjusted position will then have the short put strike at 1150, and the short call strike of 1190, resulting in a 40 point wide Iron Condor .
The current debit to adjust the position is $5.60, but this will most likely be higher or lower at the time of the adjustment. It is recommended to adjust before the end of the day today if it appears that RUT will close below 1160. Actual fill price for the adjustment will be posted if the position is adjusted.
As always, stay keen on your risk management and trade carefully,