LOL..What's this, mitotic division in the Peanut Gallery? How's it going Pizza Boy? (reaching for my Ben Gay)
Thanks to all so far, this has turned out to be quite an insightful thread. I have a question for all the IC Traders (I know there wont be a right or wrong answer to this but anyway) do you trade your ICs 1:1 or do you ratio them? If it depends on the situation, which would you say u do more often?
Anyone care to share how they trade their IC, are they set & forget or are they being managed with adjustemnts, morphing when required? Only asking as curious about the percentage returns being posted. Been trading em for awhile now and If they are actively managed by adjusting, rolling etc.. returns should stay fairly consistent.
I'm a 1:1 person. If my portfolio requires a market bias (to make my portfolio nearer to market neutral), I choose a new iron condor with strikes that are closer to the money on one side - as a delta adjustment. Mark
Many use set and forget, feeling they have a built in stop loss. That's a very bad idea, in my opinion. Risk management is an essential part of trading iron condors, and the maximum loss is simply unacceptable to me. As far as returns go, the fewer adjustments, the better. Obviously, if a position can be held until it's time to close at an appropriate low price, that's best. But being certain that large losses are avoided is the path to consistent returns. Mark
Spin, And you are the mitotic inhibitor. It's going okay. Good to see that the market is treating you well. AZD
Another question, what kind of RRR do you consider acceptable? What would be the minimum credit you would need to consider entering a trade? Ive seen examples of Condors being put on for a net credit of under 20 cents, but that doesnt seem to be worth placing a trade for..... I have an example here and any comments on why/why not you would consider this would be much appreciated. MCD MAR09 70 CALL Buy 0.45 MCD MAR09 65 CALL Sell 1.45 MCD FEB09 50 PUT Sell 1.05 MCD FEB09 45 PUT Buy 0.50 Total Credit collected 1.20 (inc 0.35 slippage) Max Risk 380
Thanks, thats about as complete an answer as I was hoping for. I understand Risk/Return can be a very subjective area, just wanted to make sure I was playing the right game at least.