The Market is currently crashing which is harder to win either calls or puts because crowds are shorting stocks on the crash market but also other crowds who think it is the dip to buy. Then here comes the Iron Condor Options Strategy.
What is Iron Condor?
An iron condor is a four-legged strategy that provides a profit plateau between the two inner legs. The maximum risk is limited.
So you are staying in the middle of Bulls and Bears fighting and get paid.
For those who still didn't understand Iron Condor.
- You want to bet on a ticker but don't want to risk all the money you bet.
- For example, you have $1000 cash and want to enter the Iron Condor position.
- Robinhood requires 100 stocks of that ticker but you don't have it, so you need to make a deposit equal amount of it. Or no deposit to enter, if you already have 100 stocks of what you are betting.
- You pay the deposit, Robinhood then gives you 30%-50% profit instantly no matter what.
Case #A: If Robinhood requires a $1500 deposit to enter, but you have only $1000 cash, you can still enter with $1000 if Robinhood offers you a $500 credit at the 'Review Order'. In this case, you don't need $1500, Robinhood will accept that $1000 and make even and let you enter.
Case #B: If you have $1500 cash, Robinhood still gives you the $500 credit so even though you enter the Iron Condor position you still have $500 in the balance (they will fund you instantly or allow them a couple of hours to finish), this is a 'cleared cash balance' that you can withdrawal to your bank account right away or swipe the card. This is your 'profit' regardless of your loss at the expiration date. And yes, you can also invest in other stocks or options trading (which I don't recommend, because you are doing this for 'risk proof' but you are gambling the risk again).
- At the expiration, you also receive the full $1500 deposit back if your position is in the price range you set or a portion of the deposit. in Case of #A, you will receive $1500 at the expiration, in Case of #B, you will receive $1500 at the expiration but you also received another $500 credit, remember?
- Do not play this on random stocks or just because you are holding 100 shares of some stock.
- $PYPL 165P-180P 195C-210C EXP 11/06Winning Ratio: 86.4% – Cost to Enter: $780 – Max Profit: $726
- $BABA 280P – 300P 320C – 340C EXP 11/06Winning Ratio: 89% – Cost to Enter: $1160 – Max Profit $844
- $PFE 33P – 35P – 37C 39C EXP 11/06Winning Ratio 79.5% – Cost to Enter: $130 – Max Profit $70
(Each position is 1 order, not 4 separate orders, you have to open these 4 legs all at once, you will see the pictures below).
- $PYPL 165P – 180P – 195C – 210C EXP 11/06 – Winning Ratio: 86.4%
If you get in, here are the extra profit or loss, this is another profit you will be getting at the expiration besides the profit Robinhood funded you in the picture above, yes, extra income. Same meaning, Robinhood is giving you back $1500 deposit in total (remember you didn't pay full $1500 deposit when you enter).
- $BABA 280P – 300P – 320C – 340C EXP 11/06 – Winning Ratio: 89%
- $PFE 33P – 35P – 37C – 39C EXP 11/06
My other guide for dummies. – Tools I used to jump up my winning ratio
Submitted November 02, 2020 at 11:52PM by ClientSpare8405