How To Setup & Analyze an Iron Condor Using ThinkorSwim

http://tickertank.tumblr.com In this video, TickerTank Founder Nick Fenton reviews an Iron Condor Options strategy. Find out how to spot an Iron Condor opportunity, how to set up the trade, and how to analyze probability of success, max gain, and max loss. Also, hear some of his rules when trading Iron Condors.

Comments

1. Nick, you've been the greatest coach in actually structuring condors on the internet. I appreciate all your help.
2. Trading for 34 cents is not worth it...Commissions will eat up any long-term profits. You need to widen your strikes and still collect min 33%.
3. What would you say is the likelihood of being assigned a stock before expiration with both short positions out of the money?
4. Very good - however....! There is a risk reward of 2:1 and I know that the probability of success was around 66% but still - I really don't like R:R more than 1:1 There seem to be many Options set ups out there with similar R:R. As far as I can see - there is a lot to be said for keeping it "simple stupid" DITM Calls and Puts with Delta above .7 and more than enough time to allow for time decay. Just need to be sure of a big enough move to make it profitable. Good lesson though - nicely done.
5. Great vid, Now I know what the Tastytrade guys R talking about when they say 1/3 the width of the strikes.  I also have a much clearer understanding of what the analyze graph is showing.  Keep up the gr8 work
6. If either side becomes ITM one week before expiration, would you adjust?
7. were dit you get that software?
8. Thanks for sharing!
9. Iron condoms
10. Awesome video Nick... Thanks!!!
11. Gotcha
12. Sure did, but not before expiration on the trade used in this example. Would have been max gain.
13. Went a tiny bit over 60. ;)
14. All valid points, all of which we agree with. Thanks for sharing.
15. I would like to give some advise, first if you are going to place an iron condor you have to make sure that the Implied Volatility of that underlying is high or rich because Iron condor lose money if implied volatility expand, second you don't need to look at the chart to select the range, implied volatility is defined as the market maker expected move during that expiration cycle, so you can calculate the expected move and set up the iron condor within that range.
16. I rarely exceed a BP Effect of 5% of my portfolio capital when opening an Iron Condor positions. More often than not it's in the 2-4% range. That's my personal max amount of spreads, but to each their own. Rarely do I let them expire worthless unless it's an earnings based trade with Options that are expiring that day and the stock is trading at or near the middle of the max profit range. In non-earnings related cases, I tend to exit 7-10 days prior to expiration, or even earlier.
17. Correct thanks, per 100 then is 3,400. And it there is no limit to the amount of contracts or is 10 recommended. Obviously, With the condor, option trading rules are disregarded and unless approaching the upper and lower sets then we let expire to collect premiums. I am still chicken about setting one up and seeing how it works out. No straddle jokes please. Thanks for your response. I appreciate it....A
18. It's $34 per spread (0.34*100), so 10 spreads would translate to $340.
19. Hi Ticker Tank, I have a question, so .34 cents at expiration is that $3,400 pr 10 contracts? Of both BCS and BPS expiry?
20. Focusing on selling Iron Condors in underlying's with IV Percentile's trading at or near their 52-week high is generally the best way to minimize VIX risk. We cover getting implied volatility on the chart in one of the videos. Studies -> add study -> lower studies -> vol studies -> imp vol