[Opening Iron Condor on Russell 2000 Index]
Dear Member:
With the Russell 2000 Index falling off a bit today, I am looking to open a fairly wide iron condor. This trade would be for a credit and involves putting on all 4 legs simultaneously.
I am placing an order simultaneously to enter the following positions:
Buy to open the Nov 760 puts (RUTWL)
Sell to open the Nov 770 puts ((RUTWN)
Sell to open the Nov 860 calls (RUZKL)
Buy to open the Nov 870 calls (RUZKN)
All for a limit of a $2.90 credit.
As you probably are aware, this play consists of essentially 2 credit spreads, a bear call spread and a bull put spread. Obviously at expiration, at worst, only one side could lose. If the index stays between 770 and 860 to expiration, I will be able to keep the whole credit since all of the referenced options would expire worthless.
DISCLOSURE: At the time of publication, I have no position in the Russell 2000 index nor in any of the referenced options.
Sincerely.
Bill Kraft
|
