Symbols traded: IWM (41DTE) short Iron Condor, SPY (4DTE) short Iron Fly

I’ve entered two positions today, both non-directional. The first, IWM, will be managed on March 7, which is 21 days before expiration. SPY expires after a long 3-day holiday weekend, on February 20. I’ll exit shortly after the opening bell.

I exited SPY on expiration date, for a 22.8% loss. Trading after the 3-day holiday weekend sent the price sliding beyond its projected low.

Given the higher volatility of the market, and the tendency to make dramatic moves, I’ve concluded that the low DTE strategy isn’t productive at present, and I’ll be passing on it until things change. By low DTE I mean 1DTE, 3DTE before a weekend, or, as in this case, 4DTE for a 3-day holiday weekend.

Instead, I’ll focus on the 45DTE strategy, managed at 21 days before expiration, such as the IWM position included on this trade analysis sheet.

IWM showed a 13.9% profit 21 days before expiration, and I exited. My rules say to exit a 45DTE position either when it reaches 50% of maximum potential profit, or 21 days prior to expiration, whichever happens first.

IWM short Iron Condor

LOT:	3	ENTRY DATE:	2/16/2024
		MANAGEMENT:	3/7/2024	EXPIRATION:	3/28/2024
		DAYS HELD:	20

Entry and Exit

METRIC	CREDIT	DEBIT	CHANGE	CHANGE %	ANNUALIZED CHANGE %
Options premium	$ 2.88	$ (2.48)	$ 0.40	13.9%	252%
METRIC	ENTRY	EXIT	CHANGE	CHANGE %	ANNUALIZED CHANGE %
Stock price	$ 203.17	$ 206.74	$ (3.57)	1.76%	32%
Impllied Volatility Rate	51.6	46.8	-4.8
Days to expiration	41	21

The structure of the position

STRUCTURE	STRIKE	ODDS EXPIRE OTM	DELTA	IN PRICE	OUT PRICE	NET PRICE
Calls
Long	215.00	76.0%	24	$ (2.14)	$ 1.57	$ (0.57)
Break-even	211.88	69.5%	30.5
Short	209.00	63.0%	37	$ 3.89	$ (3.48)	$ 0.41
Puts
Short	196.00	78.0%	21	$ 3.12	$ (1.19)	$ 1.93
Break-even	193.88	73.5%	25.5
Long	191.00	69.0%	30	$ (1.99)	$ 0.62	$ (1.37)
						======
				`	NET TOTAL:	$ 0.40

Risk and Reward

Per contract:
Reward	288.00
Risk	262.00
R/R Ratio (n:1)	0.9

---

SPY short Iron Fly

LOT:	8	ENTRY DATE:	2/16/2024
		MANAGEMENT:	2/20/2024	EXPIRATION:	2/20/2024
		DAYS HELD:	4

Entry and Exit

METRIC	CREDIT	DEBIT	CHANGE	CHANGE %	ANNUALIZED CHANGE %
Options premium	$ 2.00	$ 2.59	$ (0.59)	-22.8%	-2067%
METRIC	ENTRY	EXIT	CHANGE	CHANGE %	ANNUALIZED CHANGE %
Stock price	$ 501.83	$ 497.96	$ 3.87	-0.77%	-70%
Impllied Volatility Rate	17.0	24.1	7.1
Days to expiration	4	0

The structure of the position

STRUCTURE	STRIKE	ODDS EXPIRE OTM	DELTA	IN PRICE	OUT PRICE	NET PRICE
Calls
Long	505.00	81.0%	18	$ (0.38)	$ 0.01	$ (0.37)
Break-even	504.00	66.0%	32.5
Short	502.00	51.0%	47	$ 1.40	$ (0.07)	$ 1.33
Puts
Short	502.00	58.0%	53	$ 1.51	$ (4.12)	$ (2.61)
Break-even	501.00	67.5%	38.5
Long	499.00	77.0%	24	$ (0.53)	$ 1.59	$ 1.06
						======
				`	NET TOTAL:	$ (0.59)

Risk and Reward

Per contract:
Reward	200.00
Risk	100.00
R/R Ratio (n:1)	0.5

By Tim Bovee, Portland, Oregon, February 16, 20, and March 7 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.