XOP Analysis

SPDR S&P Oil & Gas Exploration & Production ETF (XOP)

Update 6/25/2019XOP pushed to 51.4% of maximum potential profit, and I exited my short iron condor position for a debit of $0.17 per share. That produced a $0.18 per share profit on the options, with the stock priced at $26.00, or $0.96 above the entry point.

XOP during my holding period traced a sideways pattern a bit more than $2 wide. The implied volatility rank dropped by 8.3 to 35.6%.

Shares rose by 3.8% over 19 days, or a +74% annual rate. The options position produced a 105.9% return for a 2,034% annual rate.

I have entered a short iron condor spread on XOP, using options that trade for the last time 43 days hence, on July 19. The premium is a $0.35 credit and the stock at the time of entry was priced at $25.04

The profit zone for this position is between $29.35 on the upside and $20.35 on the downside.

The implied volatility rank (IVR) stands at 43.9%.

Premium: $0.35 Expire OTM
XOP-iron condor Strike Odds Delta
Long 31.00 96.0% 4
Break-even 29.35 92.0% 9
Short 29.00 88.0% 14
Short 22.00 83.0% 14
Break-even 20.35 88.0% 9.5
Long 20.00 93.0% 5

The premium is 17.5% of the width of the position’s wings.

The risk/reward ratio is 4.7:1.

By Tim Bovee, Portland, Oregon, June 6, 2019


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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