RUT January Iron Butterfly Adjusted to Downside.
The downside adjustment for the January position filled for 5.60. Adjustment details are:
BOUGHT RUT January 1150 Put, 32.40 debit.
SOLD RUT January 1100 Put, 12.60 credit.
SOLD RUT January 1130 Put, 22.60 credit.
BOUGHT RUT January 1080 1100 Put, 8.40 debit.
Net debit (all four legs): $5.60
The graph of the adjusted position is below:
RUT January Iron Butterfly after downside adjustment:
The position summary after the adjustment is as follows:
SHORT January 1150 Call
LONG January 1200 Call
SHORT January 1130 Put
LONG January 1080 Put
LONG January 1235 Call
The position is now a 20 point wide Iron Condor, with the extra long call purchased at trade entry.
The next adjustment trigger point as per the guidelines is at either short strike, depending on the position status and overall market conditions at the time the trigger is reached. Since the expiration breakeven on the downside is at 1102, we do not plan to adjust this position again today. Rather, it will be evaluated on Monday, with any market cooperation we will see a slight rally into the shortened Holiday trading week.
Trade updates will be posted as appropriate.
As always, stay keen on your risk management and trade carefully,