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Iron Condor Options Trading Strategy - Best Explanation

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www.SkyViewTrading.com The Iron Condor… Don’t let the name intimidate you. It’s actually pretty simple and is one of the most powerful option strategies that exists. The strategy consists of a short call and put, and also a long call and put as protection to limit our risk. This way, we are able to sell option premium even with a small account and with very little risk. Watch this video to learn how to trade the Iron Condor to make a low-risk non-directional trade that allows you to collect option time decay and also capitalize on high Implied Volatility. Also, make sure to sign up for our FREE 3 Video Lesson Series at www.skyviewtrading.com! Follow us on Twitter - www.twitter.com/skyviewtrading Like us on Facebook - www.facebook.com/skyviewtrading Adam Thomas Sky View Trading how to trade an iron condor iron condor tutorial what are options option pricing options explanation stock options option strategies Iron Condor Iron Condor Option Strategy option trading basics option time decay
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Text Comments (211)
jinghan tan (7 days ago)
Why is the commission rate different from what i saw from my account ?? 😢
Placide Elisée Tine (1 month ago)
Thx man... Liked and Subscribed. You deserved it!!!
Mark Anderson (1 month ago)
All thanks to Mr Frank Robert, who has changed my life with his amazing strategy, trading with him has brought a great joy in my family now we no longer depend on our monthly salary. Mr Frank is the best account manager i have ever seen when it comes to trading forex/binary options that is why i call him a trade master.
Mark Anderson (1 month ago)
To know more about Mr frank strategy contact him via email: [email protected]
JISU LEE (2 months ago)
Is there any possibility that you can get assigned even though you bought put options?
Alaric (2 months ago)
assuming you aren't naked on the call & put, shouldn't you factor inside the net gain/loss of the 200 shares you own?
Driskell Brandl (2 months ago)
I recomend *FirstMillionRoad* for trading tips and tricks with good results
Mike Okismall (2 months ago)
What happens when the contracts expire and you required by a 100 shares but don't have the capital for it?
Phuah Kok Heng (2 months ago)
I learn more detail in your explanation. Do you have a video on how to repair iron condor?
Matt Dathew (2 months ago)
very good
Kris Zellers (2 months ago)
Thank you for posting this you should be given a reward from you tube as this is the best explanation and visual presentation as most people who post here you can't see there screen which makes it worthless
carlos santa cruz (2 months ago)
does this work for margin bitcoin trading?
Ramen Vermicelli (2 months ago)
What happens if the stock price ends up somewhere between the short strike price and the protection purchase? For example, in the video you sell a 65 put and buy a 60 put; what if the stock price ended up at 62.50?
Alvin Akbar (1 month ago)
You would get assigned and be short 100 shares of the stock at $65 a share. That basically means you need to buy it back at a price below $65 to make a profit. If the price is at $62.50 after expiration that means you could buy to close for a $2.50 profit per share(65.00-62.50). But if the stock price keeps going up, and you still held on to the stock, you could be looking at a very large loss. For example if the price went up to $70 a share after expiration, then you would be down $5 dollars per share for a total of $500 loss.
wsia5012 (3 months ago)
What happens if the price ends in between $85 and $90?
Deepakk Chabria (3 months ago)
excellent video, explained in a very simple and detailed manner, also very well illustrated. even a layman like me can understand
Orville Pickard (3 months ago)
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Mr. Vizard (3 months ago)
This shit still makes zero sense
R0man 009 (3 months ago)
https://zerodha.com/open-account?c=RV7706 20 rs option
Carlos Braga (4 months ago)
best explanation for sure. great man
Dk tomanyexwives (4 months ago)
Well explain on Iron codor
Blue Skies (4 months ago)
so actually you can make more money if you don't buy the protection --if the stock just stays in the range. If you have a good rangebound stock and can combine covered calls with cash protected puts you make out like a bandit! :) You can buy te protection anytime later, if needed
Alvin Akbar (1 month ago)
"so actually you can make more money if you don't buy the protection --if the stock just stays in the range." That's what folks with larger accounts and more experience do. It's called a short strangle. "If you have a good rangebound stock and can combine covered calls with cash protected puts you make out like a bandit! :) You can buy te protection anytime later, if needed" That's an excellent strategy used all the time.. but usually with larger accounts. Doesn't work as well with small ones.
thomas bentele (4 months ago)
All thinks goes to MR MICHEAL for his guidelines on forex trading, he has being a good teacher you can not be with MR MICHEAL and loss a trade or have you lost in trying to trade forex the only man that can do it for you and make you smile again is MR MICHEAL you can contact him. [email protected] .com
Benjamin Ramos (4 months ago)
A fantastic video indeed. Home Run. Very useful and to the point.
Lenny Wiggins (4 months ago)
Will the Broker let you buy back the $85.00 C and let the $90.00 C run?
Sky View Trading (4 months ago)
Yes they will. It's called "legging out". WE personally don't trade in this way but yes, you are free to do that.
Raahi (5 months ago)
The man is very articulate and eloquent. But to me it was all French because I am new to this and the terminology is so unknown.
Lori Favela (5 months ago)
I'll have to keep watching Again and again.
galaxy905 (5 months ago)
Seriously, best option videos that I've ever seen! Good luck if you found someone else explaining a complex trade such as Iron Condor simply and beautifully as this guy just did! Great job guys. Please keep the good work up and keep the videos coming. Knowledge is the power.
Michael Perry (6 months ago)
Adam I hope you will do a video on how to navigate the Think or Swim platform. Help!!!!!
Michael Perry (6 months ago)
keep them coming Adam
Jon McBrine (6 months ago)
I'm looking for specific technical indicator settings that work for all options trading or specific technical settings for each options strategy.
Viengsinakhone Leuang (6 months ago)
the only way is up... nice intro music
Rick Jones (6 months ago)
Iron Condors sure as hell aren't working in this market environment.
ariel velazquez (7 months ago)
Best Iron Condor explanation on the whole WWWeb, thank you!
Janardhan Theppasandra (7 months ago)
Very clear explanation!
Braadkuiken (7 months ago)
just a thing I haven't really understood about your videos. do you have all options expire? because I have seen multiple places talking about waiting till expiration date and others trading their options before expiration. also if you sell an option, can you trade this? (just to get my facts straight)
Zachary Sutton (7 months ago)
Great video! Thank you for sharing.. Question...at 2:57 when your strategy is showing, when you say you are "selling the call and put options, is the @2.00 reflecting that you are selling 2 contracts? and only buying 1 contract for each put and call? Thank you again!
stupot008 (7 months ago)
Thank you
G mail (8 months ago)
this shit is way too fuckin confusing
marcus clay (8 months ago)
I been trading Iron condors for years, and this the best explanation/presentation. When someone want to know what i do. I simply refer them to this video. Keep up the good work.
derco2000 (8 months ago)
I agree Marcus. I've been using Iron Condors for a while also, and this video is the best I've seen.
Warren B (8 months ago)
What platform you're using? Thank you for the explanation I'm starting to learn option trading.
ANDREW LIND (9 months ago)
you never said when you bought on the iron condor you just talking about sell call sell put when did you buy them how long did you have them
Stephnie Gammill (9 months ago)
Warren Buffett said that if past history is all there is to the game of riches, the richest people would be librarians. Binary options and Forex PAID and are STILL PAYING! Traders have only lost courage/faith due to scammers permeating the web. And yes, most of us were and are still ignorant of the right strategies at this discouraging moment but if you look closely you'll see that when you combine ignorance and leverage, you get some pretty interesting results! Please this advice isn't for everyone to heed, it's for those who make things happen and not those who just watch them happen! i am very proud to say that i have helped many in hitting their first million dollars in trading! It's saddening that very many of us just scroll past posts, even those that are actually one in a life time opportunities! We definitely can’t be blamed. But the successful today, have certainly lost a couple of times before but kept pushing! With the last confidence in you.. if interested in this feel free to email me... [email protected]
Mathew Emmel (9 months ago)
Had it be that i knew or come in contact with Mr Frank Robert for the past years of trading i would have gone far beyound where i am now in the Stock trade and Forex/Binary Option, his strategy works like miracle and his ways of trading is extraordinary frabjous, just adhering to his order and instructions on his strategy not labouring myself any more and winning my capital back with 60k dollar monthly, truly he is a fabulous Broker with winning strategy for every trader.
Mathew Emmel (9 months ago)
You can ask him for help through email: [email protected]
Larry Hoover (9 months ago)
how can i sell an option which i don't have?
derco2000 (8 months ago)
You can't sell shares of stock you don't have. But a Call option is just an agreement with someone to buy stock from you at a a certain price, sometime in the future (like 30 days). If the stock price is higher than what you agreed on, the option buyer will not exercise it (it's out-of-the-money). If it looks like the option will be in-the-money, you close out the trade before expiration. Either way, you don't ever have to own any of the stock.
Global Autobahn (9 months ago)
Thank you, very clearly explained
KGR RAO (9 months ago)
very clear and super explanation. honest & simple
Swamy Star (9 months ago)
Is it adviceable to exit the trade on the very next second after we place trade on that time itself we are in profitif we are in profit... And doing the same trade some more time .... I mean enter the trade with profit and exit the trade very next second ..and doing some more times...
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SteveS (10 months ago)
What happens if the price of the underlying asset goes above the call that we wrote, and the buyer wants to exercise? What if you do not have the capital to deliver? Thanks, Steve
derco2000 (8 months ago)
Buyers rarely exercise their options. But if they do, you can exercise the Call Option you bought and take the loss. It won't be too devastating.
Barmander (10 months ago)
Why use the iron condor vs a regular verticle spread.
derco2000 (8 months ago)
You can sell a Call credit spread and make some option premium. Or you can sell a Put credit spread and make some option premium. Or you can sell both the Call AND the Put credit spreads and make twice as much premium. That is the Iron Condor. It's my favorite vehicle for generating monthly income.
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thishadowithin (10 months ago)
Actually, this isn't a good strategy. In order to make money you're required to let that trade expire within a certain price range which closing the trade early, you lost money. The odds are greatly stacked against you in terms of sheer luck that it might be within that dollar amount. I mean, look at even the most horizontal companies can jump around depending on news. You're taking a big chance here. I've bought in several times using an Iron Condor and to my surprise even after expiring In the money, I still lost. You have to deal with its depreciation of value every day, which is steadily declining the second you buy in. I've talked to others and they have the same scenario happen over and over. Many people avoid these spreads like the plague.
derco2000 (7 months ago)
You don't buy iron condors, you sell them. And if they all depreciate to zero, you keep all the premium. I've been using iron condors for a while. It's my favorite Options income method.
Maria Popek (11 months ago)
best explanation of an iron condor I've seen.
Bahaa Sallam (11 months ago)
I have never seen such a great and wonderful strategy like Frank Robert's own, his strategy and his pattern of trading gives evryone mighty winning, all that i have lost in the time past in the market are all back to me, his strategy is earning me mightily every week, You and your strategy are wonderful Sir
Bahaa Sallam (11 months ago)
traders contact him for his graet strategy throu email: [email protected]
Daniel Perlin (11 months ago)
Amazing explanation! Thank you for this!!
Shawn White (11 months ago)
What if you tell the program to create an iron condor but only some of the options sell.
Sky View Trading (11 months ago)
Great question! But this is of no concern to us. The technology is advanced enough to where it will fill all the legs of the trade, or none at all. You won't ever get filled on only one of the legs. But the KEY is sending it as one order as we showed at the end of the video.
Douglas Lyon (1 year ago)
On average, these things will loose money. Check it out: https://vimeo.com/229978326
Fissaha Darge (1 year ago)
Does the profit/loss estimate include trading cost?
Duy Pham (1 year ago)
13.3% move in 30 days for a $75 stock can sell for $2 =)))))))))
Nishant Aneja (1 year ago)
Why 13% probability chosen? Any particular thought behind it?
Reynolds martins (1 year ago)
Nice video
Reynolds martins (1 year ago)
After the breexit period i lost over 70,000USD trading stock and after that i said to myself that i was done in trading stock,but all thanks to the great forex trader who showed me that it was possible to make 2 times that amount trading in just 3 weeks.I remain grateful to Mr Parker for shewing me the way forward in forex and i advice all trader who have been losing funds in stock to contact this Guru via email on ([email protected] . com) for help
Stock Queen (1 year ago)
Thank YOU, I finally understand!!!! You have no idea when I can figure things out. Keep up the great work.
Parag Sathe (1 year ago)
good information/
Sky View Trading (1 year ago)
+Am glad the vid was nice to you Parag Sathe you can write me on [email protected] for more of my strategies and trading platform which i operate on that is 100% trust worthy you can rely on.
Cass2kX1 (1 year ago)
what happens if your naked calls or puts are exercised?
Gustavo (1 year ago)
Fantastic, Thank you!
Sal C (1 year ago)
How does exercise work in these situations? Does being long an option mean the short option can't be exercised? How does that work?
Alvin Akbar (1 month ago)
According to the OCC, any option that expires 0.01 ITM will be automatically exercised unless the option holder specifically states they don't want that. So if you sell a 5 point credit spread, if the trade goes against you your maximum loss is equal to your margin requirement - premium received. For example say you sell a 60/65 put spread for $1. Even if that stock 100% tanks and goes to 0, your maximum loss will be $500(margin requirement) - $100(premium received) = $400 Hope that helps
Sky View Trading (1 year ago)
+Sal C you can write me on [email protected] for more of my strategies and trading platform which i operate on that is 100% trust worthy you can rely on.
Amneet Padda (1 year ago)
Which platform is it ??
TheSmokinApples (1 year ago)
Best explanation
Francisco Ulloa (1 year ago)
Gracias por la explicacion, Thank you so much for this videos, finally understand about iron condor, hae it nice day.
Johan Jamal (1 year ago)
If you make an iron condor without the calls as insurance will it still be an iron condor? Meaning, you just execute two put trades.
Sky View Trading (1 year ago)
The calls aren't the insurance. The long call and the long put are the insurance. If you ONLY do the put side, it's called a Vertical, we have a video on this here --> https://www.youtube.com/watch?v=6_0SbRaHv1U If you sell a put and sell a call (but don't buy the protection), then it's called a Strangle. We don't have a video on YouTube about this but we do have one on our website about this strategy (and every other strategy that we trade). Check out the site for those vids! Link in description.
CruznKnFuzn (1 year ago)
why a condor though? lol
Chad Yost (1 year ago)
videos are easy to watch. thanks
Mando (1 year ago)
What if you can't find a call and pull with same probability?
Sky View Trading (1 year ago)
You can just ball park it. Doesn't have to be exact. The markets are going to move around anyways.
Louis Zaza (1 year ago)
Thanks for your time and coaching I'm in UK and what platform would you advice plz
elghark (1 year ago)
You say that this strategy exploits time decaying and low volatility (our hope). nevertheless at 8:30-8:35 you say it's better using 30-60 days expiration options. So, why not using a shorter time horizon?
Sky View Trading (1 year ago)
If it weren't for Gamma, we'd all just sell premium with 1 day to expiration and do that every week! But definitely important to find that balance. Thanks for the comment and great question though! Haha absolutely. We use a mix of a few different programs. Paint is definitely not one of them! Shoot us an email and I'll send you a list of the programs we use. There's a contact form at the bottom of the homepage of our website that you can use to contact us!
elghark (1 year ago)
Ok I admit I've always underestimated the Gamma. I find all your videos brillant. Can I ask u what software do u use for drawing graphs? I'm opening a blog and I'd like to avoid using "Paint" (yes, very sad) for drawing graphs and other stuff. Thanks
Sky View Trading (1 year ago)
Because of what is called "Gamma Risk"... Yes, selling shorter duration options will REALLY put time decay in our favor. But our P/L swings will be very large and when the market goes against you, there isn't much you can do because you don't have enough time and extrinsic value on the options to make any adjustments... Kind of a more complex topic but that is the reason... When we go out to 30-60 days, we STILL have time decay in our favor, but we have much less "Gamma Risk"... 30-60 days is where we find the perfect balance between having plenty of time decay in our favor but not having gamma against us so much.
chalemi (1 year ago)
Great videos! Are these videos(like this Iron Condor) talking about trading real stock or option premiums? Hate to think I'm creating a SELL order for stock I don't own. Thanks.
Sky View Trading (1 year ago)
Great question! We are trading the options on the stock, NOT the shares of stock directly. When we say we are selling an option. That just means we are selling it as an opening trade. Another term for selling an option is to "write" the option. We have videos on our website explaining this concept. It isn't as complex as it sounds! Thanks for the comment. All the best!
Marc W. (1 year ago)
Thanks for the video. What happen if at Day3 price went up to $100. But right before the expiration day, it came back and stayed at $75?
Very awesome video! I've been learning about these recently and the more I watch your videos the more it makes sense! There's just ONE tiny thing I don't quite get yet, at the very end of the video where you showed what the iron condor would be trading at with 2 days left to expiration and it showed .01, and then you said you could sell it right now for a profit, how much profit would you get and how did you know that? Sorry that last part confused me a little bit. Everything else though made perfect sense, so thanks for the video! :-)
s k (1 year ago)
Today at 9:30 AM i have placed iron condor with march expiry options.Below are the levels which i placed. Nifty current price 8800( rounded off) BUY 9500 CE SELL 9300 CE SELL 8300 PE BUY 8100 PE Nifty is currently between defined levels of 8300 and 9300 .Even nifty didnt break iron condor levels, on overall it is showing loss. My doubt is how iron condor is prone to loss ,even nifty didnt break levels.Plz clarify..!
kalandai ramoo (1 year ago)
Jaroslav Kohout (1 year ago)
Matt Tebbetts (1 year ago)
you are AWESOME and I love your videos!!!!!!!!!!!!!!!!!!
Sky View Trading (1 year ago)
Thank you :) Many more to come soon!
Tā Moko (1 year ago)
OMG! It's going to take me a million years to understand this! OMG! I think i need to find another way to make money! Even the jargon is CONFUSING! Good luck everyone!
Sky View Trading (1 year ago)
I promise if you stick with it, it will all start to make sense. I agree, the jargon is confusing. I wish it weren't that way... I assume it's because money managers wanted to use complex terminology to make it all sound complicated so average people will feel that they can't do it themselves. But now, it kinda just is what it is. BUT, I promise, if you hang in there (and learn the basics first to lay the groundwork), this stuff is extremely simple. It just takes some getting used to and proper education.
Emily Mia (1 year ago)
have you been scamed? Do you have stalked money in your option trading and forex trading account? i was in the same plight until i watched this video. this video really help me alot i learnt many basic things from here.... but i received the greatest help from Mr. ETHAN JACOB who helped me in all the process of reclaiming my lost and stock money.. you can contact him if you are having any issues also. [email protected]
Theo Paine (1 year ago)
Well done presentation.
lakayonx (1 year ago)
In the first example you were explaining, what woul happen if the price went up to $89 (being the short call ITM, but the long call still OTM)? Please explain.
Sky View Trading (1 year ago)
Stock at 89... The 85 Call would be worth 4.00, and the 90 Call would be worth 0.00. Both puts would also be worth 0.00... So our net exit price would be 4.00. So since we entered at 2.00 and closed at 4.00, we lost 2.00. If the short call is assigned, you'd be left with short stock at 85.00... Which is fine too. Although early assignment rarely happens, all you'd do is close the position at the current market value of 89. And you lost 4.00 on the stock that was assigned. But you kept 2.00 from the original entry. So your net loss is still just 2.00. I know that sounds kinda confusing. We have a full video coming out on assignment soon that we will send to our email list (it won't be on YouTube). Make sure you sign up to our email list via the homepage of our site.
lakayonx (1 year ago)
What if said short call was assigned?
daveychaz (1 year ago)
Don't forget about commissions x 4 trades.
Dechul Jeong (1 year ago)
If we want the same rate, do we need to be a paid member on your site? Or if we simply sign up with TD using the link on your website, would non-paid members still get the same rate? Thanks
Sky View Trading (1 year ago)
daveychaz (1 year ago)
Good to know tks, and nice work on the vids.  Great explanations.
Sky View Trading (1 year ago)
Yes, you're absolutely right. But that's why it's important to be on a good commission rate. We have a deal with TD Ameritrade to get cheap commissions for our members and viewers. Check out 7:24 - You'll see our commissions for this trade is only $4.00 total (that's $1.00 per contract with no flat rate). But yes, you're right. Thanks for the comment!
Marty Summers (1 year ago)
Fantastic explanation!!!
Hamed Dadgour (1 year ago)
Fantastic video, well done!
psulse (1 year ago)
excellent explanation...thanks!
Can we do it with in the money prices?
rajendra mirgal (1 year ago)
Very nice presentation.
Dinkar Gangwal (1 year ago)
hello Rajendra, Pl contact [email protected] to exchange our views and experience in option trading. Thanks.
Sky View Trading (1 year ago)
Thank you!
Rob R (1 year ago)
Does it ever happen that, because youre so close to 0 days left in the option, the iron condor set up doesn't fill up all the spots and you end up with ad lob sided condor?
Sky View Trading (1 year ago)
Hey Rob, This will not happen as long as you enter the Iron Condor as one order. Did you see the order we pulled up at the end of this video? If we were to send that order, then it would either only fill all the legs of the trade, or none. Basically, the entire Iron Condor will be filled on one exchange and they treat it as one order. You either fill on the whole thing, or not at all. Hope that answered your question!
Joseph Nguyen (1 year ago)
great video.
eks (1 year ago)
Hi, thank you for explaining everything in a easy and cohesive manner! I just have one question, if you short a option, it would be in your best interest for the option to expire correct? However do you need to offer the broker anything (as they loaned you the option to short in the first place) even if it is a statement proving the position they loaned you is worthless. I tried to google it and saw that you cannot exercise an option when it expires. Sorry I am extremely new to this and some of these terms are quite confusing. Thank you in advance if you reply!
Sky View Trading (1 year ago)
thinkorswim by TD Ameritrade... www.skyviewtrading.com/preferred-broker/
robert mccully (1 year ago)
The software he was using showed the odds on the right.. before he clicked buy!
Evan Vink (1 year ago)
I really appreciate all the help! This is my fourth time watching this video and i learn something each time. Thanks!
Sky View Trading (1 year ago)
Thanks, Evan! Glad you're enjoying the video!
Evan Vink (1 year ago)
What happens if the price falls in between 90 and 85? Say 87$. So now your 90 is now otm and the 85$ you sold is itm. What happens then?
Zohaib Khan (7 months ago)
Then you will be forced to buy the shares of FB at $90 X 100 which is $9000. Iron Condor can send you in Hell if price is in between the spread at the date of expiration
Sky View Trading (1 year ago)
At expiration, the 60 and 65 puts would be worthless, and the 90 call would also be worthless... The 85 Call would be worth 2.00. Since the 85 Call is the only option that has value, then the Iron Condor as a whole would also be worth 2.00 (since the price of the iron condor is the NET price of all the short/long options). We originally sold this Iron Condor for 2.00, so if the stock is at 87, you would simply break even on the trade. See 6:58. But instead of 87, let's say the stock is at 88.00... The Iron Condor would be worth 3.00 (since the 85 Call is 3 points in-the-money and the 3 other legs are all worthless)... If we sold (to open) it at 2.00, and close it at 3.00, then we lost 1.00 (and, of course, since options have a multiplier of 100, this would mean we really lost $100). Hope that made sense!
M Weissmann (1 year ago)
Is the profit or loss on the iron Condor calculated at the expiration date ?
Sky View Trading (1 year ago)
M Weissmann yes it is. The profit/loss will of course fluctuate during the life of the trade but in this video, the profit/loss is calculated assuming we are at expiration.
Abdulla Al Qassab (1 year ago)
how can i apply this on forex
Sky View Trading (1 year ago)
Hey Abdulla, you could trade this strategy with forex options... The problem is, forex options tend to not be very liquid so I wouldn't personally recommend doing that... Just learn equity options! They are easier to trade than forex options and are extremely liquid!
letrevisdnathan (1 year ago)
Hey Sky, do I you sell the contract the day before expiration or do you let it expire for my iron condors if its in the money the week of?
Sky View Trading (1 year ago)
Not sure I fully understand the question... But to sum it up, we rarely let our Iron Condors expire. We're either taking the profit early, or if it's at a loss, we would close it right before expiration... However, there are some occasions when we let it expire ITM if BOTH the short and long option are ITM... Then it would expire and disappear (the short and long strikes would offset each other). Whether or not we do this 100% depends on commissions and fees. Sometimes if you are trading big enough size, then letting it expire is cheaper than closing it. If you are new to this strategy, I would guess you are probably trading very small size anyways... In that case, you'll always want to close it if it's at a loss... And if it's at a profit and all the options are OTM? Well, you CAN let them expire worthless and many traders attempt this. However, if you're wondering what we do, we usually close the profit long before the expiration date. Hope that made sense!

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