Hello,
I have been options trading on my own for several months. I have both a live and a simulated account with scottrade pro / interactive brokers. My live transactions tend to be iron condor in nature, and always in the safest territory possible (which decreases my earnings). I use the simulated account to test, track, and possibly become comfortable with slightly riskier transactions, and to tinker with "what if". I have a live iron condor due to expire in the next few day, with quite a wide spread. There is definitely room for a narrower version of the same. I placed the original and a narrower option in my simulated account to track and test profitability and risk. The two spreads use 1 common strike. I've never thought of an iron condor as separate legs. I've always looked at it as a package. It threw me off a little when the two spreads cancelled out one leg.
original iron condor: Call -2480, +2485 Put -2420, -2415
narrower spread: Call -2475, +2480 Put -2445, +2440
I've bought and sold the 2480 strike, leaving my position at 0. I realize that if I needed an out, reversing the order would close it. That was not my intention in this case - but a great learning experience. Only the original iron condor is live. Where exactly would I stand, had I placed both transactions live? Is the (sold) 2475 strike no longer covered?
Thanks!
Denice
I have been options trading on my own for several months. I have both a live and a simulated account with scottrade pro / interactive brokers. My live transactions tend to be iron condor in nature, and always in the safest territory possible (which decreases my earnings). I use the simulated account to test, track, and possibly become comfortable with slightly riskier transactions, and to tinker with "what if". I have a live iron condor due to expire in the next few day, with quite a wide spread. There is definitely room for a narrower version of the same. I placed the original and a narrower option in my simulated account to track and test profitability and risk. The two spreads use 1 common strike. I've never thought of an iron condor as separate legs. I've always looked at it as a package. It threw me off a little when the two spreads cancelled out one leg.
original iron condor: Call -2480, +2485 Put -2420, -2415
narrower spread: Call -2475, +2480 Put -2445, +2440
I've bought and sold the 2480 strike, leaving my position at 0. I realize that if I needed an out, reversing the order would close it. That was not my intention in this case - but a great learning experience. Only the original iron condor is live. Where exactly would I stand, had I placed both transactions live? Is the (sold) 2475 strike no longer covered?
Thanks!
Denice
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