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  • Victory spreads and volatility

    November 25, 2009 by  
    Filed under Double Calendars, Iron Condors, Options, Victory Spreads

    Q: So far so good on my first month of condors…..2 weeks in….still delta neutral. Haven’t had to adjust yet…..but ready to if threatened.

    I want to try the back-ratio type of trade to protect against a huge downstroke in January, but for the life of me I cannot get the analysis chart to look like it does in your video.

    I have 10 grand in cash in the account with 2 grand in margin already on.

    I made sure I am set for “1st triggers sequence”.

    I insured I am set to “single symbol” and double check that no other positions or options are checked.

    I check the dates……+1 at X, N/A, P/L open……etc…..I’m looking very closely and making certain my screen looks exactly like yours does in the video. I’m making sure I ‘buy’ the distant OTMs and ‘sell’ a single near month ITM. It just isn’t working.

    I’m playing around with the strikes and months…..but for the life of me I cannot get the graph to look like yours does in the video. It always shows that the risk amount is roughly half of the margin required……not the 50 bucks or so that you show in the video.

    I thought it might be possible that you have to have at least 25 grand in the account and satisfy the day-trading margin requirement and without that it won’t work right…..but I just don’t know.

    A little help here? What could I be doing wrong? Thanx in advance if you can help….

    A: The victory spreads only work
    when the volatility is high.

    The best strategy for a market in
    which we anticipate higher volatility
    is put calendar spreads for monthly
    income.

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