Iron Condor - Help

Sang Froid

Well-known member
344 60
Hi all,

I'm new to the world of options trading and setup an iron condor this morning daily due to expire today. When I got into the position it started -£9, now with about an hour left it's only -£5.80 despite being well within the range? Please can someone explain where I've gone wrong as I have no idea now.

condor2.PNG
condor1.PNG
 

Sang Froid

Well-known member
344 60
So that expired with a loss of £1.80 despite being well inside the range? I thought the idea of an iron condor is to choose a ranging instrument, sell a put option at (x) buy a put option at (x) just underneath the sell and the same with call options and wait for time decay to do it's thing, as long as the price remains inside those bounds you make a profit?

Have I missed something?
 

Sang Froid

Well-known member
344 60
cost of the spread between bid and offer of option has taken the profit into a loss
Thank you, I had a feeling it may have been this, I've tried to setup another few iron condors this evening but the spread is prohibiting any kind of profit on IG Index which is quite annoying. I might try some other things, wondering if I could set up some kind of synth condor using S&P 500 and Dow.

Anyway, thanks for the reply.
 

0FXTrader0

Well-known member
497 72
try trading straddles or even cheaper trade strangles
 
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Sang Froid

Well-known member
344 60
try trading straddles or even cheaper trade strangles
Thank you for the tip, 16 delta strangle certainly looks interesting

edit, I think from what I have breifly read a strangle you still have to have some directional bias where as a straddle though more expensive benefits from volatility rather than direction so this I think suits me a little better.
 
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