Use The Iron Condor Spread and Profit From Todayas Stock Market
Want to gain your personal financial freedom, even during in these trying economic times? If you are willing to handle your personal expenses responsibly, then using the Iron Condor Spread, one of the best option trading tips available, your money can be put back to work for you. Time may be needed, but the rewards for your patience are often worth it.
When it comes to successful online option trading, The Iron Condor Spread is a bit more advanced than other option trading systems, but results in higher profits and a lower potential loss. The Iron Condor Spread is made up of both bear-call and bull-put options, spread out on the same underlying security. Built off of the Condor Spread, the Iron Condor Spread results in a net credit by doubling the credit of a single spread position.
How does this option trading tip work to make you a profit? It works by using two spreads, which creates two separate break-even points. A lower break-even and an upper break-even. Anytime a stock's price stays above the lower break-even and beneath the high break-even, you can count on profit being generated.
Before you start make sure your account has plenty of available cash in it. A large number of online option traders will prevent you from entering into a spread like this unless you are able to fulfill margin requirements with proper funding.
What benefits does using an Iron Condor Spread provide? 1) The utilization of an uncovered position by not having to purchase or hold any stock. 2) This tip generates a complete neutral strategy. 3) Due to call and put options potential returns are increased. 4) Double credit provides lowered potential risk as well as controlled risk
The Iron Condor Spread is ideally used when the underlying asset is not expected to change, or to only change minimally over the course of the life of the option. When the middle strike equals the price of the underlying asset, the profit is maximized at expiration. In addition the range of customisation allowed with this system of option trading is admirable. This is calculation of profit:
Maximum Profit = Net Credit Profit % = (Credit gained from short legs/greatest difference in strike) x 100 Max Loss = Greatest difference in the consecutive strike a" net credit This formula allows a maximum profit that is limited to the gained net credit. As for maximum loss, it is limited to the calculated maximum loss.
Using the Iron Condor Spread provides a large number of advantages, although be forewarned of this: making a profit using the Iron Condor Spread requires time and active monitoring. As a result a proper analysis prior to entry will be necessary. It is also important to remember that the Iron Condor Spread will require high levels of trading to be successful. Traders with lower levels of trading will be unsuccessful in using the Iron Condor Spread.
When it comes to successful online option trading, The Iron Condor Spread is a bit more advanced than other option trading systems, but results in higher profits and a lower potential loss. The Iron Condor Spread is made up of both bear-call and bull-put options, spread out on the same underlying security. Built off of the Condor Spread, the Iron Condor Spread results in a net credit by doubling the credit of a single spread position.
How does this option trading tip work to make you a profit? It works by using two spreads, which creates two separate break-even points. A lower break-even and an upper break-even. Anytime a stock's price stays above the lower break-even and beneath the high break-even, you can count on profit being generated.
Before you start make sure your account has plenty of available cash in it. A large number of online option traders will prevent you from entering into a spread like this unless you are able to fulfill margin requirements with proper funding.
What benefits does using an Iron Condor Spread provide? 1) The utilization of an uncovered position by not having to purchase or hold any stock. 2) This tip generates a complete neutral strategy. 3) Due to call and put options potential returns are increased. 4) Double credit provides lowered potential risk as well as controlled risk
The Iron Condor Spread is ideally used when the underlying asset is not expected to change, or to only change minimally over the course of the life of the option. When the middle strike equals the price of the underlying asset, the profit is maximized at expiration. In addition the range of customisation allowed with this system of option trading is admirable. This is calculation of profit:
Maximum Profit = Net Credit Profit % = (Credit gained from short legs/greatest difference in strike) x 100 Max Loss = Greatest difference in the consecutive strike a" net credit This formula allows a maximum profit that is limited to the gained net credit. As for maximum loss, it is limited to the calculated maximum loss.
Using the Iron Condor Spread provides a large number of advantages, although be forewarned of this: making a profit using the Iron Condor Spread requires time and active monitoring. As a result a proper analysis prior to entry will be necessary. It is also important to remember that the Iron Condor Spread will require high levels of trading to be successful. Traders with lower levels of trading will be unsuccessful in using the Iron Condor Spread.
About the Author:
TheScienceOfTrading.com provides 90 free minutes of videos on option trading systems and provides a complete and detailed stock trading course for beginners to experts.
posted by Credit Counseling at
6:49 AM
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