[TheOptionClub.com] Re: Best Adjustment Method

 

RFH,

Let's say on the SPY you sold the Mar. 10 117, and bought the Mar. 10 120 vertical spread for a net credit. Or, the call part of the iron condor.

The price is at 116.84. It's almost at 117. It hits 117.10

To perform the vertical roll, what trades would you place?

Thanks

--- In OptionClub@yahoogroups.com, "RobertH" <robhansen5252@...> wrote:
>
>
>
> I've said it before and I'll say it again. There are as many ways to adjust an iron condor (credit spreads) as there are people who put them on. I've been gravitating towards setting up the short calls with a delta of around 10, and when the delta reaches 20 do a vertical roll. I'll add more contracts on that side to get back to the original expected profit. I've been shying away from moving the opposite side in to get additional credit because it's easy to get whipsawed in crazy months (like this past March expiration).
>
> RFH
>
> --- In OptionClub@yahoogroups.com, "metagunny" <justin@> wrote:
> >
> > Anyone? What is the best adjustment method for verticals?
> >
> > I've checked the files and it lists 20 different methods.
> >
> > --- In OptionClub@yahoogroups.com, "metagunny" <justin@> wrote:
> > >
> > > Let's say you do an iron condor. Or, really just one of the vertical spread trades so you are either bearish or bullish.
> > >
> > > The SPX hits your short strike.
> > >
> > > How would you adjust the trade?
> > >
> > >
> > > I know there are a lot of options, convert it to a butterfly, roll up, etc, but what is the best strategy?
> > >
> > > If it's not static, i.e., you should always do this adjustment, what are the variables to look at to determine which adjustment method to use?
> > >
> > > To see a screenshot of my realized gain\loss (real money) screenshot for March so far from TD Ameritrade go here:
> > >
> > > http://www.freeimagehosting.net/image.php?a73c20084c.jpg
> > >
> >
>

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