Here is a video on handling the Iron condor that may or may not pose a problem. If stock moves above 540 it will go higher, if not the short sellers will take it down much lower, and if the market is in a nasty mood like today. Today the stock held very well despite [...]

The market has dropped to the point where corrective actions is necessary. One can always close the position if short strikes are within 20 points of the price. But markets can bounce back and ride up creating a whiplash. Remember there are least 26 days till  February expiration and lot can happen. All prices as [...]

IRON CONDOR is an option strategy used by professional traders and is a purely income generation tool. Iron condor is named as such because it carries protection and a guaranteed outcome with a high probability of success. IRON CONDOR Spread is the combination of a bullish vertical credit spread and a bearish vertical credit spread [...]

Senate has passed the bail out bill and sent it to the House for approval. Its a one good step, but the problem has not been solved. Its the confidence and level of ease that has been shattered on Monday when the house rejected the original bill and that bitter taste is still there. No [...]

We are in the midst of a Wall street crisis, noted as worst since 1929. LEH, AIG, WM, MER you name it. Its seems shorts are not done selling till they wipe out every institution on the Street.
This the worst selling I have witnessed in last 2 years. Trading Iron Condors and credit spreads is very [...]

NDX at 1768, RUT 714 I have closed 70%  positions due to market conditions. Its too risky to trade these markets. Raised cash.
Yes there are strategies to rollover trades down and out to next month, but I am not using those. These markets are greatly influenced by poor economy and the bad unemployment reports and a constant parade of [...]

1.NDX  IRON CONDOR – 93% probability - Is doing great and is very safe -time decay is  taking its toll on the spreads.
2. RUT BULL PUT SPREAD – 97% probability  and has more than 30 % profits, and is very safe at the moment. Remember we closed calls side for 0.15 taking profits when RUT dipped ? May [...]

NDX bounced off its 50 day moving average at 1877 levels and RUT bounced off 720 levels at its 200 day moving averages. Had we broken down, than we could be seeing some serious downturns here and the whole market would have turned bearish. The good news today is that my McClellan Oscillator and Summation Index has [...]

All September trades are listed in the members area. We have 4 income trades two on indexes and 2 on stock options.
1.  RUT Index Iron Condor– September expiration 92% probability
2. NDX index iron condor– September expiration 90% probability
3. AAPL bull put spread– 93% probability of success.
4. POT speculative trade- income generation
All these trades are [...]

Index options trading is focused on major indexes wholly and not on individual stocks. The same principles can be applied to stock trading but often with different results. Indexes are an aggregate sum of stocks and move with the general trends prevailing in the markets, depending on the economy, oil, wars, and world events.
1. [...]

With the market up second day in row NDX at 1900 levels and hitting 50 day moving average above, closed the NDX put spread for 0.05 cents. The theta on the spread was far less than next months at the same strike or above. Will look for new set ups in the making.
Closed NDX [...]

With a strong rally today DOW up 331 and NDX up 64.92, the bull put spread has diminished in value down to 25 cents. Because the markets are in rally mode, completing an IRON CONDOR is risky and and counter productive. The markets will start reaching your short strikes and there is not enough premiums.
Time [...]

An option strategy used by professional traders and is a purely income generation tool. Iron condor is named such because it carries protection and a guaranteed outcome with high probability of success. The risk/ reward ratio in a IRON CONDOR is not what an investor is looking for but the high probability of success of the outcome. Nothing [...]

Index options trading

Index options trading
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A credit spread is a limited risk strategy. Your risk is predefined and your reward limited. A spreader is a risk aversed trader who is using probabilities to profit from the markets. A credit spread is a net credit to your account that involves buying one option and selling another option at a different strike. Option [...]