[TheOptionClub.com] Update on Reverse IC Positions [2 Attachments]

 

[Attachment(s) from Ricky Jimenez included below]

GOOG
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On Wednesday, 3-3 the position was +510p -520p -530p +540p +540c -550c
(2 contract each, red graph). On Thursday GOOG rallied past 550 so I
decided to ditch the lower 3 options of the put condor. So the trade
was:
-510p + 520p + 530p for a debit of 2.5 (.6,1.1,2). Resulting in:
540p +540C - 550C as in the blue graph. The idea was to wait for
another big move as GOOG is in the habit of doing. If GOOG tanked,
the 540 put would become very valuable. If it surged up, I could get
some good premium by selling the 560/570 call spread giving me a call
condor. The up move happened today and when GOOG was about at 562, I
put on -540p -560c +570c for a 6.50 credit (2, 9.70, 5.20) so I am
left with the condor:
+540c -550c -560c +570c (black graph). This condor has a reward to
risk ratio of 11.5 to 1 and is still in the profit zone, something
that is not possible if you put on a condor all at once.

IWM
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On 5-4 the position was:
-2*62p +63p +64c -2*65c +66c (26 copies), a combination of a put ratio
and a call fly (see blue graph). I said in a previous posting that if
IWM went passed 66, I would sell the 63 put and extend the fly to a
condor. That is exactly what I did today:
-63p + 65c - 2*66c + 67c for a .02 debit (.17, 1.72, 1.04, .55). The
result: -2*62p +64c - 65c -66c + 67c shown in the black graph.

As for the other positions, I started out with a -190p +200p +210c -
220c in AAPL. Not much movement until today when I got rid of the
puts. I could have closed the entire position for a 30% profit but
since only play money is at stake, I will keep all the positions until
expiration to practice as much as possible. I also have IBM and RIMM.
Neither has moved enough to have done anything. IBM is showing a 50%
loss on a 120,125,130,135 reverse IC while RIMM is showing a 23% loss
on a 65,70,75 reverse iron butterfly.

If there is a better way I can present the progress of these trades,
please let me know. And of course, you are all welcome to kibitz on
how I could be doing better.

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Attachment(s) from Ricky Jimenez

2 of 2 Photo(s)

GOOG 3-5.jpg

IWM 3-4,3-5.jpg

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