IWM Analysis

iShares Russell 2000 ETF (IWM)

Update July 17, 2019I’ve exited IWM for 50% of maximum potential profit — a $0.21 debit, 21 cents less than the credit received at entry — as shares were trading for $155.28, which is 16 cents above the price at entry.

The price basically went nowhere during the position’s lifespan. The implied volatility rank fell from 13.9% at entry to 10.4% at exit, joining with the normal theta decay of options to produce the profit.

Shares rose by 0.1% over 12 days, or a +3% annual rate. The options positions produced a 100.0% return for a +3,042% annual rate.

I have entered a short iron condor spread on IWM, using options that trade for the last time 42 days hence, on August 16. The premium is a $0.42 credit and the stock at the time of entry was priced at $155.12.

The profit zone for this position is between $163.42 on the upside and $143.42 on the downside.

The implied volatility rank (IVR) stands at 13.9%.

Premium: $0.42 Expire OTM
IWM-iron condor Strike Odds Delta
Long 165.00 91.0% 9
Break-even 163.42 88.0% 12
Short 163.00 85.0% 15
Short 145.00 85.0% 14
Break-even 143.42 87.0% 12.5
Long 143.00 89.0% 11

The premium is 21% of the width of the position’s wings.

The risk/reward ratio is 3.8:1.

By Tim Bovee, Portland, Oregon, July 5, 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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