Symbols traded: MSFT (1DTE) short Iron Fly, XSP (1DTE) short Iron Fly

I entered two trades the day before each expired, both structured as short Iron Fly options positions: MSFT and XSP. My intent is to exit them shortly after the next session begins.

XSP has an offerings that expire every day. MSFT expires weekly and is is much less flexible. I chose to enter MSFT after earnings had been published and traders had sufficient time to turn their attention elsewhere. The post-earnings timing produced an extremely low IVR, which is a plus for short Iron Fly trades.

MSFT rose sharply and I exited for a 40.9% loss. XSP also produced a loss, albeit a small one: 2.1%.

MSFT short Iron Fly

LOT:	1	ENTRY DATE:	2/8/2024
		EXIT DATE:	2/9/2024
		DAYS HELD:	1

Entry and Exit

METRIC	CREDIT	DEBIT	CHANGE	CHANGE %	ANNUALIZED CHANGE %
Options premium	$ 3.32	$ 5.62	$ (2.30)	-40.9%	-14856%
METRIC	ENTRY	EXIT	CHANGE	CHANGE %	ANNUALIZED CHANGE %
Stock price	$ 413.90	$ 418.31	$ (4.41)	1.07%	389%
Impllied Volatility Rate	2.9	1.9	-1.0
Days to expiration	1	0

The structure of the position

STRUCTURE	STRIKE	ODDS EXPIRE OTM	DELTA	IN PRICE	OUT PRICE	NET PRICE
Calls
Long	420.00	89.0%	11	$ (0.26)	$ 0.35	$ 0.09
Break-even	415.82	63.5%	31.5
Short	412.50	38.0%	52	$ 2.63	$ (5.95)	$ (3.32)
Puts
Short	412.50	37.0%	63	$ 1.14	$ (0.03)	$ 1.11
Break-even	410.82	64.0%	36
Long	407.50	91.0%	9	$ (0.19)	$ 0.01	$ (0.18)
						======
				`	NET TOTAL:	$ (2.30)

Risk and Reward

Per contract:
Reward	332.00
Risk	293.00
R/R Ratio (n:1)	0.9

---

XSP short Iron Fly

LOT:	6	ENTRY DATE:	2/8/2024
		EXIT DATE:	2/9/2024
		DAYS HELD:	1

Entry and Exit

METRIC	CREDIT	DEBIT	CHANGE	CHANGE %	ANNUALIZED CHANGE %
Options premium	$ 1.85	$ 1.89	$ (0.04)	-2.1%	-768%
METRIC	ENTRY	EXIT	CHANGE	CHANGE %	ANNUALIZED CHANGE %
Stock price	$ 499.35	$ 500.18	$ (0.83)	0.17%	61%
Impllied Volatility Rate	8.2	8.5	0.3
Days to expiration	1	0

The structure of the position

STRUCTURE	STRIKE	ODDS EXPIRE OTM	DELTA	IN PRICE	OUT PRICE	NET PRICE
Calls
Long	502.00	84.0%	16	$ (0.38)	$ 0.28	$ (0.10)
Break-even	500.85	64.0%	35.5
Short	499.00	44.0%	55	$ 1.54	$ (1.57)	$ (0.03)
Puts
Short	499.00	56.0%	45	$ 0.92	$ (0.65)	$ 0.27
Break-even	497.85	67.5%	33
Long	496.00	79.0%	21	$ (0.23)	$ 0.13	$ (0.10)
						======
				`	NET TOTAL:	$ 0.04

Risk and Reward

Per contract:
Reward	185.00
Risk	115.00
R/R Ratio (n:1)	0.6

By Tim Bovee, Portland, Oregon, February 8-9, 2024

Disclaimer

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.

License

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Based on a work at www.timbovee.com.