Igor – I wasn’t quite sure where to submit a general question – so I have chosen ‘Tips’.
– In your Trading Rules that would govern the way you do Income Lab trades – are you bound to trade Iron Condors all the time?
– With the glorious benefit of hindsight in the recovery from the 43 point ‘down day’ on the SPX on May17 – it would have been far more profitable to have traded a Bull PUT only – leaving the Bear CALL side off the IC.
– From May18 to May26 – Bear CALLs just got in the way.
– This was particularly relevant to 2 trades – 23JUN17 IC + 07JUL17 IC
I try to stay mechanical with these trades. It’s impossible to tell when a trade is going to be a good one or a bad one, only after the trade is closed. With that said, risk management is key. I know people think that selling premium when VIX spikes is the best time to do it but the reality is that we get sharp moves when VIX is ‘high’ and that makes managing a trade a little harder.
Leaving only put side in 23JUN and 7JUL after SPX traded down to 2350 would be best if we knew that SPX will make new highs a week later. Since we didn’t know, we did our best to keep drawdowns small. We do have traders that use their own discretion and skipped the bear call part, they’re probably on their way to the bank right now.
– It’s great that we are now doing EIP trades. I will follow with interest.
– I note that some of the “bread & butter” ICBase Condors are now closed or close to being closed.
– Are you going to do some more ICBase Condors?
– Many thanks