I invented the Iron Condom. Being dyslexic I was watching a video on Options and I came up with the idea ! Unfortunately it wasn't a very profitable venture.
Excellent explanation on ICs. I probably should be doing more of these, but I don’t. I use to do short strangles, but I stopped doing naked calls. Now I predominantly do the wheel, like you said we’ve been trading sideways for a while, and this strategy works as well. So I will have short covered Strangles on from time to time. Looking forward to hearing more about the platform.
Dave, do you ever trade SPX index options spreads? I prefer them when doing credit spreads and so forth over SPY. Very liquid and settles in cash. Also, no early assignment with SPX and it has many Exp. dates available. Some are AM settled, so you have to be aware of that. Because of the high dollar amounts of the options you pretty much can only do spreads, unless you're Warren Buffet. Great content!
Hi Andy. I have not traded index options but like the tax advantages so on the short list for myself. When are you putting out a video for me?👍😃What platform do you use to trade index options?
@@wealthadventuresYeah it definitely has some advantages. It's been a decently profitable strategy for me during this 3800 to 4200 range we've been in. I tend to primarily use TD Ameritrade (ThinkorSwim) for the multi-leg options stuff. Like you my main brokerage is Fidelity but their platform just doesn't handle complex options very well, as you pointed out. 🤙
Dave, great video as always. I use fidelity like you for my core account, but they have so far given me a hard time about allowing me to do anything but covered calls and cash secured puts. I have start doing Iron Condors and Call/Put credit spreads on a small part of my account. For this I am using TDAmeritrade/ThinkorSwim and Tastytrade both have allowed me to do credit spreads and Iron condors and have a much better interface to work with options than Fidelity does, IMHO. Currently my strategy is to put spreads or IC on SPY about 45(or more) DTE and take them off around 20 (or so) DTE, while I am still learning and getting started it has been working out really well so far. Theta decay keeps churning in my favor. I like SPY because the open interest and volume is good and the bid/ask it generally just a penny or two. I am interested in hearing more about the options platform you end up with as well as some of the trades you put on.
Just started trading Iron 🪰. 7DTE ATM 10 wide on SPY. .72 cost round trip in my Tradier account. 80%win rate so far and I am still modifying my strategy. Need to let my winners run more. New subscriber, enjoy your channel.
Nasdaq and Tech specifically YTD has been very strong. Risk free rate might be 4-5% but keeping meaningful cash in money markets is a waste and you're still underwater when you consider the real inflation rate.
All true but I'm happy keeping a chunk of money safe on the sidelines at the moment. I'm waiting for a rainy day and keeping up with inflation with some option income. It may never come and I do still buy each week... Just not as much.
Hi. Looks like SPY was at 405.51 when I sold the 414/418 call spread on 3/31. It was at 411.52 when I sold the 401/392 put spread on 4/4. So, yes, moved against me so I sold some credit to toss on the fire!
Dave, a little off topic, but I recently took some profits, and have $15k in cash waiting to deploy and want to sell some cash secured puts while it just sits. Any stocks you like to sell CSP’s on? Should I use it on 1 stock? Break it up and sell multiple on several stocks? I sell weekly CC’s on a few positions and prefer shorter options trades. Thanks for any ideas
Another question... If this benefits from the time decay a lot, why not use a smaller/bigger strike price and a longer expiration date, like 2 months. It will be safer and not pass those strike prices as easily. Plus, you collect a bigger premium because of the longer expiration date. Also, you have more time to close it all or clip a wing. What do you think?
@@wealthadventures Thanks again, Dave. I'm going to give it a whirl for June 30, with the upper band at 440/450 and the lower band at 380/390. I'm kind of guessing the 440 is more likely to be crossed than the 390. But, who knows!
@Wealth Adventures OK... I'm all set now! I noticed something that if I want to close the IC I just set up, I have to close each leg separately in Fidelity. I was hoping to be able to close all the 4 legs in one shot. Am I seeing this correctly?
@@Reza16888 If you are looking at your Positions tab there should be a button that says "option summary" at the top under the symbol column. From that screen you can usually close spreads and condors when you click on the strategy for that ticker. I say usually because sometimes it does not group the strategy the way I traded it.
Great video! Thank you! One question... Can all of my 4 legs be naked? Meaning, I neither have the cash nor the stock. But, I'm tier 3 in Fidelity and have plenty of non-margin buying power.
Yes. It is all defined risk. One caveat will be when the stock ends between the strike price of one of your spreads. Best practice is to close it out prior to expiration.
@Wealth Adventures Good tips. Thanks again for coaching me. Because I also trade in Fidelity, your videos with examples in Fidelity have been my trainers since I started almost a year ago.
Your humor in all your vids is not lost on me! Greatly appreciate the details presented AND your presentation style!
Ditto
Thanks! Appreciate it.
I invented the Iron Condom. Being dyslexic I was watching a video on Options and I came up with the idea ! Unfortunately it wasn't a very profitable venture.
Excellent explanation on ICs. I probably should be doing more of these, but I don’t. I use to do short strangles, but I stopped doing naked calls. Now I predominantly do the wheel, like you said we’ve been trading sideways for a while, and this strategy works as well. So I will have short covered Strangles on from time to time. Looking forward to hearing more about the platform.
Majority of my trading involves spreads of some sort these days. Just looking for that extra level of protection in most instances.
Very interesting to watch. I think I may have actually learned something. Looking forward to seeing what you have found as a Fidelity substitute.
Thanks!
Great stuff as always, Dave. I hope that Robinhood is a contender for your new platform...NO options fees and a KILLER APY on uninvested cash.
Hey Wayne. Robinhood does have some nice benefits including that 4.65% for cash.
Dave, do you ever trade SPX index options spreads? I prefer them when doing credit spreads and so forth over SPY. Very liquid and settles in cash. Also, no early assignment with SPX and it has many Exp. dates available. Some are AM settled, so you have to be aware of that. Because of the high dollar amounts of the options you pretty much can only do spreads, unless you're Warren Buffet. Great content!
Hi Andy. I have not traded index options but like the tax advantages so on the short list for myself. When are you putting out a video for me?👍😃What platform do you use to trade index options?
@@wealthadventuresYeah it definitely has some advantages. It's been a decently profitable strategy for me during this 3800 to 4200 range we've been in. I tend to primarily use TD Ameritrade (ThinkorSwim) for the multi-leg options stuff. Like you my main brokerage is Fidelity but their platform just doesn't handle complex options very well, as you pointed out. 🤙
@@wealthadventures IB is the best IMO, and with SPX there is no risk of assignment because they're European style options
@@shanedavey6993 Thanks again!
Another great options video…thx
Dave, great video as always.
I use fidelity like you for my core account, but they have so far given me a hard time about allowing me to do anything but covered calls and cash secured puts.
I have start doing Iron Condors and Call/Put credit spreads on a small part of my account. For this I am using TDAmeritrade/ThinkorSwim and Tastytrade both have allowed me to do credit spreads and Iron condors and have a much better interface to work with options than Fidelity does, IMHO.
Currently my strategy is to put spreads or IC on SPY about 45(or more) DTE and take them off around 20 (or so) DTE, while I am still learning and getting started it has been working out really well so far.
Theta decay keeps churning in my favor.
I like SPY because the open interest and volume is good and the bid/ask it generally just a penny or two.
I am interested in hearing more about the options platform you end up with as well as some of the trades you put on.
Just started trading Iron 🪰. 7DTE ATM 10 wide on SPY.
.72 cost round trip in my Tradier account. 80%win rate so far and I am still modifying my strategy. Need to let my winners run more.
New subscriber, enjoy your channel.
Thanks for subscribing! So you like the short DTE trades?
@@wealthadventures sp far so good. Let you know after another two weeks. That will be a month of daily trades.
Nasdaq and Tech specifically YTD has been very strong. Risk free rate might be 4-5% but keeping meaningful cash in money markets is a waste and you're still underwater when you consider the real inflation rate.
All true but I'm happy keeping a chunk of money safe on the sidelines at the moment. I'm waiting for a rainy day and keeping up with inflation with some option income. It may never come and I do still buy each week... Just not as much.
Great lecture. So what was the reason to add the second wing? Did SPY move against your first credit spread ?
Hi. Looks like SPY was at 405.51 when I sold the 414/418 call spread on 3/31. It was at 411.52 when I sold the 401/392 put spread on 4/4. So, yes, moved against me so I sold some credit to toss on the fire!
Dave, a little off topic, but I recently took some profits, and have $15k in cash waiting to deploy and want to sell some cash secured puts while it just sits. Any stocks you like to sell CSP’s on? Should I use it on 1 stock? Break it up and sell multiple on several stocks? I sell weekly CC’s on a few positions and prefer shorter options trades.
Thanks for any ideas
Hard to say... any stocks/ETFs that you like at the moment?
Iron condors are a good strategy, but oh my gosh are they a pain to put on and manage. If a platform ever makes them easier, I would do them.
I've got one! I'll be talking about it more over the next few weeks.
Another question... If this benefits from the time decay a lot, why not use a smaller/bigger strike price and a longer expiration date, like 2 months. It will be safer and not pass those strike prices as easily. Plus, you collect a bigger premium because of the longer expiration date. Also, you have more time to close it all or clip a wing. What do you think?
Hi. In most cases I like IC trades around 5-8 weeks. That has been working well for me. I think 2 months is a good choice.
@@wealthadventures Thanks again, Dave. I'm going to give it a whirl for June 30, with the upper band at 440/450 and the lower band at 380/390. I'm kind of guessing the 440 is more likely to be crossed than the 390. But, who knows!
@Wealth Adventures OK... I'm all set now! I noticed something that if I want to close the IC I just set up, I have to close each leg separately in Fidelity. I was hoping to be able to close all the 4 legs in one shot. Am I seeing this correctly?
@@Reza16888 If you are looking at your Positions tab there should be a button that says "option summary" at the top under the symbol column. From that screen you can usually close spreads and condors when you click on the strategy for that ticker. I say usually because sometimes it does not group the strategy the way I traded it.
@@wealthadventures Thanks. Let me check it out. I will keep you posted.
Did this trade require margin? If so how much?
I'm not sure of the margin requirements at Fidelity but max loss would have been $3700.
So I can convert an iron condor to s spread?! That’s a new one 😮😢
Ha! I suppose. Am I breaking option LAW?
Great video! Thank you! One question... Can all of my 4 legs be naked? Meaning, I neither have the cash nor the stock. But, I'm tier 3 in Fidelity and have plenty of non-margin buying power.
Iron condors are defined risk trades. You just need the cash that's the width of the spreads. If spread is 10 wide you need 1000 bucks
@@steve99912 can the cash come from my margin?
Yes. It is all defined risk. One caveat will be when the stock ends between the strike price of one of your spreads. Best practice is to close it out prior to expiration.
@Wealth Adventures Good tips. Thanks again for coaching me. Because I also trade in Fidelity, your videos with examples in Fidelity have been my trainers since I started almost a year ago.
Dave, I have been using tasty trade (before tastyworks) for a month… and it’s great. You should check it out. Cheers
Do you find it easy to work with? Has it been easy to transition?
Definitely. Much easier than any other platform for OPTIONS. So far, very good indeed.
@@alexandresimioni798 Nice! Thanks.