Comments on: Jeff’s Journal – Intro – Iron Condors http://tradersresearchinstitute.com/blog/jeffs-journal-intro-iron-condors/ Traders teaching traders to become better Wed, 04 Jan 2012 12:35:04 -0500 http://wordpress.org/?v=2.8.3 hourly 1 By: Owen http://tradersresearchinstitute.com/blog/jeffs-journal-intro-iron-condors/#comment-1358 Owen Mon, 21 Feb 2011 00:08:17 +0000 http://tradersresearchinstitute.com/blog/?p=57#comment-1358 Thanks for the complement and allow me this opportunity to apologize for not replying/posting here more often. I'm not going to address the IWM question only because I don't trade BWBs on IWM any longer. (I have forgotten that I once did) - sorry guys. However, in answer to the "Umbrella" part - As the market moves around, add positions to increase your points (short points) where you will be profitable. As an example, if the market (the market being GLD) is trading 128, Sell the 128. When it moves to 132, Sell the 132. Maybe that will be in the same month as the 128, maybe not; it all depends upon timing. The goal being to have a risk graph that shows a large umbrella over a number of strikes. Start with a contract or two and then add as you go. Over time you will become comfortable with the strategy and it will be second nature to you. Remember, you can't trade someone else's trading plan; you must develop your own trading plan and be consistent. Thanks for the complement and allow me this opportunity to apologize for not replying/posting here more often.

I’m not going to address the IWM question only because I don’t trade BWBs on IWM any longer. (I have forgotten that I once did) – sorry guys.

However, in answer to the “Umbrella” part – As the market moves around, add positions to increase your points (short points) where you will be profitable. As an example, if the market (the market being GLD) is trading 128, Sell the 128. When it moves to 132, Sell the 132. Maybe that will be in the same month as the 128, maybe not; it all depends upon timing. The goal being to have a risk graph that shows a large umbrella over a number of strikes.

Start with a contract or two and then add as you go. Over time you will become comfortable with the strategy and it will be second nature to you. Remember, you can’t trade someone else’s trading plan; you must develop your own trading plan and be consistent.

]]> By: Michael http://tradersresearchinstitute.com/blog/jeffs-journal-intro-iron-condors/#comment-965 Michael Wed, 15 Dec 2010 04:04:22 +0000 http://tradersresearchinstitute.com/blog/?p=57#comment-965 Hello Owen, First of all, thank you *very much* for sharing your knowledge on option trading with the internet community - watching your movies on the broken wing butterfly helps immensely to understand how to mitigate the risk after the stock has moved into the appropriate direction. Great stuff, nicely explained! Still, I have a question: How do you typically start building the umbrella? Does it only involve BWBs? Looking at the risk graph of your IWM position (March 2010) it seems as if "at the beginning" there was a straddle (since the graph points upward on both sides). To reduce the cost of this straddle you would then fill in some credit ATM BWB's and let the trade evolve... is this maybe how you proceed? Or what would you suggest instead? Do you have an example sequence of steps you typically do in order to lift your umbrella into the air? Thanks again! Best regards, Michael Hello Owen, First of all, thank you *very much* for sharing your knowledge on option trading with the internet community – watching your movies on the broken wing butterfly helps immensely to understand how to mitigate the risk after the stock has moved into the appropriate direction. Great stuff, nicely explained! Still, I have a question: How do you typically start building the umbrella? Does it only involve BWBs? Looking at the risk graph of your IWM position (March 2010) it seems as if “at the beginning” there was a straddle (since the graph points upward on both sides). To reduce the cost of this straddle you would then fill in some credit ATM BWB’s and let the trade evolve… is this maybe how you proceed? Or what would you suggest instead? Do you have an example sequence of steps you typically do in order to lift your umbrella into the air? Thanks again! Best regards, Michael

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