RUT September Iron Condor closed for better than target.
The mellow trading day leading into the long weekend allowed us to exit the September RUT Iron Condor for a bit higher than target gain. A recap of the position and closing details are below:
- SOLD RUT September 1240 Call, 18.80 credit.
- BOUGHT RUT September 1290 Call, 2.25 debit.
- SOLD RUT September 1240 Put, 20.30 credit.
- BOUGHT RUT September 1190 Put, 7.19 debit.
Order was filled as an "Iron Condor" for $29.75 net credit (all four legs).
Additional Order to cut Deltas on upside:
BOUGHT RUT September 1300 Call
Order for extra long call was filled for $1.35.
Margin/Risk is calculated by the width of the wings ($5,000), less credit received, plus the cost of the extra long call.
Margin for this trade at entry: $2,160.
Target Gain: 5% of the gross margin ($250/contract)
Max loss: 10% of the gross margin ($500/contract)
On Wednesday, August 17, RUT reached the downside adjustment trigger of 1230, and the position was adjusted as follows:
BOUGHT RUT September 1240 Put, 30.40 debit.
SOLD RUT September 1190 Put, 11.60 credit.
SOLD RUT September 1220 Put, 20.20 credit.
BOUGHT RUT September 1170 Put, 7.40 debit.
Net debit (all four legs): $6.00
On August 23, RUT reached the short call strike of 1240 and was adjusted as follows:
Upside Adjustment August 23:
BOUGHT RUT September 1240 Call, 22.00 debit.
SOLD RUT September 1290 Call, 2.05 credit.
SOLD RUT September 1260 Call, 10.40 credit.
BOUGHT RUT September 1310 Call, .70 debit.
Net debit (all four legs): $10.25
Closing Order September 2:
- BOUGHT RUT September 1260 Call, 5.60 Debit.
- SOLD RUT September 1310 Call, .20 Credit.
- BOUGHT RUT September 1220 Put, 5.20 Debit.
- SOLD RUT September 1170 Put, .95 Credit.
Closing order executed as a single order: BUY " Iron Condor" .
Net Debit to Close Iron Condor: $9.65 (all four legs)
- SOLD RUT September 1300 Call.
Net Credit to close Call: $.20.
This closing resulted in a gain of $270 (target $250), 5.4% of the gross margin.
As always, stay keen on your risk management and trade carefully,