Abstract
Iron condor options trading system comprises the Bearish Vertical Credit Spread and Bullish Vertical Credit Spread. This gives trader 4 options. There are two spreads in this trading system. The article below shows how the trading system works and what are the essential features of this option trading system.
An Iron condor options trading system is obtained when a Bullish Vertical Credit Spread and Bearish Vertical Credit Spread are combined on similar underlying security. By doing do, a trader is able to multiply credit by two times, which is obtained from a “single spread option”. This option strategy has a lower break even and also an upper break even. Profit is said to be made provided the stock remains below the point of upper break even or above the point of lower break-even.
Understanding the Iron condor options trading system:
A trader entering an Iron condor options trading system is actually making entry in to four options orders simultaneously. Profits are earned provided the stock remains within a specified range. A trader will incur loss if the movement of the stocks gets deviated from the direction specified.
Salient features Iron condor options trading system:
The Iron condor options trading system is meant for the traders intending to earn money from “premium decay”. The Hold time(average) for these stocks range between 2 weeks to 6 weeks. Hold time ends mainly due to the expiration date. The traders focus mainly on index options, which are very liquid. The stocks also need to be of repute. The objective of the investment lies in the fact that the range is quite large for earning profits to the maximum.
