Opening (Small Account): IWM November 19th 198/204/2 x 246/249
... "Double Double" Iron Condor for a 1.08 credit.
Comments: If IWM is going to give me rangebound, I'm going to play it rangebound. Here, a "double double" iron condor to accommodate call side skew. To do this, I went 6 wide on the put side, but 3 wide on the call side with the short call legs at around 1/2 the delta of the short put leg, but double the number of contracts. (Double the number of contracts on the call side, double the width of the call side spread on the put side; hence, "Double Double."). This results in a delta neutral setup with spreads on both the put and call side that are fairly equidistant from where price is current trading and wide of the range IWM has been hanging out for the past several eons. Additionally, you're not tying up additional buying power by doing things this way, since a 2 x 3 ties up the same buying power as a 1 x 6.
22.0% ROC as a functional of buying power effect at max; 11.0% at 50% max.
Comments: If IWM is going to give me rangebound, I'm going to play it rangebound. Here, a "double double" iron condor to accommodate call side skew. To do this, I went 6 wide on the put side, but 3 wide on the call side with the short call legs at around 1/2 the delta of the short put leg, but double the number of contracts. (Double the number of contracts on the call side, double the width of the call side spread on the put side; hence, "Double Double."). This results in a delta neutral setup with spreads on both the put and call side that are fairly equidistant from where price is current trading and wide of the range IWM has been hanging out for the past several eons. Additionally, you're not tying up additional buying power by doing things this way, since a 2 x 3 ties up the same buying power as a 1 x 6.
22.0% ROC as a functional of buying power effect at max; 11.0% at 50% max.
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