SPX Weekly Iron Condor Results and Entry Plan for July 4.
I have put together the summary of trade results for the SPX Weekly Iron Condor that has been in the "test kitchen" (Paper Money). Those results are below:
SPX Weekly Iron Condor Test Position Results:
Based on these results, I do plan to trade this weekly strategy live beginning with the July 4 cycle. The option code for this next cycle is SPXW140725, expiring July 25. If conditions are within the trade guidelines, the planned entry is tomorrow (Thursday). It is recommended to wait at least the first hour before entering; exact entry time is a trader's choice.
The guidelines for this weekly strategy were published on May 30, the link can be found here:
Link to Articles
The guidelines call for a minimum credit of $1.25 to enter the position. However, as is outlined in the results, during this test period it has been difficult to obtain $1.25 premium with volatility at such low levels.
VIX 5 Year Weekly Chart:
The VIX has come off the 7 year lows slightly, but we will still likely need a volatility pop of some sort to be able to get $1.25 credit. Because I do feel this is a viable weekly trade strategy and want to continue trading on a regular basis, I will consider trade entry as long as the premium is at least $1.00. I would not consider entering for less than $1.00.
As with any new strategy, particularly a weekly, I recommend trading in a small size, and be very diligent about monitoring the position. The target gain remains at 7% of the margin/risk, and the max loss is 10%.
Having said that, it is a traderâ€™s individual decision whether to wait for target gain, or max loss, on any position. Trading is a blend of oneâ€™s individual style, risk tolerance, and intuition. This combination can help reach your annual trade plan results. I recommend following your own trade style; there is nothing wrong with exiting a position early. Remember with weekly trades, there are 52 opportunities in a year to trade so it is important to be comfortable with your trade size and position. Remember, trading is an art, not a science.
I will post entry details when the position is opened.
As always, stay keen on your risk management and trade carefully,