Will BABA swing approximately 20% in either direction in 3 months? Here what the iron condor looks like.
My credit is limit is 1.88, 10 contracts returns 1880,
My credit is limit is 1.88, 10 contracts returns 1880,
BABA iron condor
- Thread starter viruscore1
- Start date
The net credit is 2.39 to 2.77. I placed trade with limit net credit of 2.88. I use this type of trade to park capital.
I am aware it's small potatoes for the hotshots making huge returns. But this is low risk trade putting idle capital to work.
Last edited:
I traded ICs on BABA for a couple months, and yeah, it is possible for that stock to move 20% in 3 months. the options are expensive for a reason...if you're right/lucky you can make good money on trades like these but my outcomes were so inconsistent that I backed away
keep us posted either way
keep us posted either way
I've done this many times with predicted results. I have not seen BABA swing 20% from the mean with in 3 month period.
Sounds like you're good to go then. I was trading them on much shorter time frames (1 month and closer) and got chopped to bits, hopefully you'll have better luck on a longer time horizon. Tone doesn't come across well on the internet but I hope it works out for you because I'm interested in doing something similar. Keep us posted
But what if it moves 16.287% tomorrow??
(By which I mean to remind: it's not so much then endpoints, but the approach, that should cause us the greater worry.)
(By which I mean to remind: it's not so much then endpoints, but the approach, that should cause us the greater worry.)
Thanks lytec, I'm a real noob, especially when it comes to this options stuff. How did you come up with those net credit numbers? Aren't you selling the closer in calls/puts, and buying the further out calls/puts? Looking at your screen shot, and going by the bids (when selling) and asks (when buying), I get much smaller net credits. 2.78-1.73 = 1.05.
Related, one thing that has always scared me away from these is the pretty big bid-ask spread. Do you just buy at the ask and sell at the bid, getting the worse prices, but ensuring that you get all 4 legs off quick without getting whipsawed? Or do you take the whipsaw risk and leg in only when you get the limit prices you want?
Thanks!
Then it would most likely retrace and close the gap. Notice it has done that before after every spike down. Remember this trade has 3 months to recover if that happens. Did you even look at the chart? Check when it was last trading at 155 and 210, then get back to me on your analysis, or lack of. You know this is an iron condor with strike prices beyond the 6 month bollinger band. Based on your comment, you are not familiar with IC.But what if it moves 16.287% tomorrow??
(By which I mean to remind: it's not so much then endpoints, but the approach, that should cause us the greater worry.)
If that is your prediction, by all means place your trade.
Last edited:
Then it would most likely retrace and close the gap. Notice it has done that before after every spike down. Remember this trade has 3 months to recover if that happens. Did you even look at the chart? Check when it was last trading at 155 and 210, then get back to me on your analysis, or lack of. You know this is an iron condor with strike prices beyond the 6 month bollinger band. Based on your comment, you are not familiar with IC.
If that is your prediction, by all means place your trade.
Wow.
Sad.
I have no idea who shit in your Post Toasties, but it wasn't me.
My post was intended to be helpful, in offering another view -- which presumably is why you posted. If that's a mistake on my part, then take your reason-to-post, and your bile, and shove them directly up your ass. It's not needed by anyone else.
So! (And truly,...)
Peace out.