EWZ Analysis

iShares MSCI Brazil Capped ETF (EWZ)

Update 7/25/2019I’ve exited my short iron condor position on EWZ for a $0.25 debit, which is 50% of maximum potential profit, with shares trading at $45.06, which is $1.40 above the entry price..

EWZ peaked nine days into the trade and then declined. The implied volatility rank at the exit was 7.9%, down 10.0 from the entry level.

Shares rose 3.2% over 23 days, or a +51% annual rate. The options position produced a 100.0% return for a +1,587% annual rate.

I have entered a short iron condor spread on EWZ, using options that trade for the last time 45 days hence, on August 16. The premium is a $0.50 credit and the stock at the time of entry was priced at $43.66.

The profit zone for this position is between $48.50 on the upside and $37.50 on the downside.

The implied volatility rank (IVR) stands at 17.9%.

Premium: $0.50 Expire OTM
EWZ-iron condor Strike Odds Delta
Long 50.00 93.0% 8
Break-even 48.50 88.5% 12.5
Short 48.00 84.0% 17
Short 39.00 82.0% 16
Break-even 37.50 86.0% 12.5
Long 37.00 90.0% 9

The premium is 25% of the width of the position’s wings.

The risk/reward ratio is 3:1.

By Tim Bovee, Portland, Oregon, July 2, 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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