Stock / Symbol: SPDR Dow Jones Industrial Average / DIA
Option Strategy: [private_monthly]iron condor[/private_monthly]
Price at trade post: $132.90
Reasoning: Between now and January expiration, the standard deviation calculation for DIA puts it in a trading range between [private_monthly]126 to 138.[/private_monthly] This non-directional trade has a delta of -23, a positive theta of 6.5 and a negative vega of -34. The probability of success on this trade is 87%. If DIA trades [private_monthly]down to $128 or up to $135, we'll either stop out of the trade or adjust the position.[/private_monthly].
Trade Details:[private_monthly]
STO -7 DIA Jan13 138 calls
BTO 7 DIA Jan13 140 calls
STO -7 DIA Jan13 124 puts
BTO 7 DIA Jan13 122 puts
for a min net credit of $0.24 per contract (day order, limit order). Try to get filled closer to the mid, currently at 0.26.
Requirements:
Cost/Proceeds ($168)
Total Requirements $1230
Estimated Commission $42
[/private_monthly]
Max Risk: $1230
Max Reward: $168 or 13.6% [private_monthly]between 124 - 138 by Jan 18
Profit Range: $124 to $138 by Jan 18
Suggested Downside stop: @ $128
Suggested Upside stop: @ $135
[/private_monthly]
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