[TheOptionClub.com] Re: Iron Condors

 

Vimal,

Welcome to the world of volatility! Iron condors are short Vega positions, so whenever Vol. rises, you will see positions showing loss. But, don't forget why you put IC in the first place - you were betting on the probability that the underlying will remain between the strikes. Keep your fingers crossed until the time comes to adjust (if any - depending on your criteria/strategy). Basically, you are right that you will make money as long as the expiration is within the strikes, but if you keep watching, your mind will experience the six flags rides without being there!

One option to balance vega is to add (may be little OTM)calendars which are long vega, and benefits from rising Volty, and still Theta positive.

Make sure you have a plan when to adjust, use TOS to estimate the effects of the price on P/L, Greeks, and you will have better grasp on the trades. If you play it with a plan, and patience; profit will follow. Options trading is the best business you can be in, and treat it like a business.

Best,

-

--- In OptionClub@yahoogroups.com, "vimalbpatel@..." <vimalbpatel@...> wrote:
>
> Hey guys,
>
> I sold some iron condors when VIX was low. But because market has been falling, VIX has shot up and because of that option prices have gone up.
>
> Prices are still well between strikes I sold but still my positions are not registering any profit as options prices are up.
>
> But on expiration, options are going to expire regardless of what VIX is. So if I hold on to my positions and price does not cross my short strikes, I will still make money.
>
> But does this make you uncomfortable with your positions as your positions are losing money every day because VIX is going up ? Or am I missing something. This is the first time I am trying iron condors.
>

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