KRE Analysis

SPDR S&P Regional Banking ETF (KRE)

Update 7/23/2019I exited my short iron condor position on KRE at 48.6% of maximum potential profit. The debit was $0.19, leaving a net credit of $0.18, with shares trading for $53.46, up $0.27 from the entry price.

KRE traced a sideways path during my holding period, running in a $52 to $54 range. The implied volatility rank at the close was 25.6%, up 7.1 from its level at entry.

Shares rose 0.5% over 20 days, or a +9% annual rate. The options positions produced a +94.7% return for a +1,729% annual rate.

I have entered a short iron condor spread on KRE, using options that trade for the last time 44 days hence, on August 16. The premium is a $0.37 credit and the stock at the time of entry was priced at $53.19.

The profit zone for this position is between $57.37 on the upside and $47.37 on the downside.

The implied volatility rank (IVR) stands at 20.1

Premium: $0.37 Expire OTM
KRE-iron condor Strike Odds Delta
Long 59.00 94.5% 6
Break-even 57.37 90.1% 11
Short 57.00 85.6% 16
Short 49.00 82.1% 16
Break-even 47.37 85.8% 12.5
Long 47.00 89.5% 9

The premium is 18.5% of the width of the position’s wings.

The risk/reward ratio is 4.4:1.

By Tim Bovee, Portland, Oregon, July 3, 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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