Profit In The Current Stock Market By Using The Condor Spread
Times are tough economically, but what if you could use the current market to achieve financial freedom? Using one of the best option trading tips, The Iron Condor Spread, in addition to handling your personal expenses with care will put your money back to work for you. You may need patience, but in time the rewards will be worth it.
The Iron Condor Spread is more advanced than other systems for trading options online. However it achieves higher profits and provides for a much lower potential loss. The Iron Spread consists of bear-call and bull-put options, spread over the same underlying security. By building off the Condor Spread, the Iron Condor Spread provides for a net credit through doubling the credit on a single spread position
How does this option trading tip make you profit? The system uses two spreads, which generates two different break-even points: the upper break-even and the lower break-even. Anytime a stock remains below the upper break even point or higher then the lower break-even, you will profit.
Before you start make sure your account has plenty of available cash in it. A large number of online option traders will prevent you from entering into a spread like this unless you are able to fulfill margin requirements with proper funding.
What are the advantages of an Iron Condor Spread? 1)Enjoy an uncovered position by not owning any stock. 2) This option trading tip is for a completely neutral strategy. 3) There is an increase on potential returns thanks to the call and put options. * Controlled risk and lower potential risk due to double credit
Use the Iron Condor Spread if the price of the underlying asset is not expected to change, or change very little throughout the option's life. When the underlying asset is equal to the middle strike, the maximum amount of profit is achieved at expiration. This option trading system allows an admirable range of customization. The following is the profit calculation:
Maximum Profit = Net Credit Profit % = (Credit gained from short legs/greatest difference in strike) x 100 Max Loss = Greatest difference in the consecutive strike a" net credit . When using this formula the maximum profit is limited to the net gained credit. The maximum loss is limited to the level of the maximum calculated loss
The Iron Condor Spread provides a number of benefits, however remember this warning: profiting from the Iron Condor Spread takes time as well as active participation and monitoring, necessitating a proper analysis prior to entry. Additionally high trading levels are needed. Traders who have lower trading levels will not be able to successfully implement the strategy of the Iron Condor Spread.
The Iron Condor Spread is more advanced than other systems for trading options online. However it achieves higher profits and provides for a much lower potential loss. The Iron Spread consists of bear-call and bull-put options, spread over the same underlying security. By building off the Condor Spread, the Iron Condor Spread provides for a net credit through doubling the credit on a single spread position
How does this option trading tip make you profit? The system uses two spreads, which generates two different break-even points: the upper break-even and the lower break-even. Anytime a stock remains below the upper break even point or higher then the lower break-even, you will profit.
Before you start make sure your account has plenty of available cash in it. A large number of online option traders will prevent you from entering into a spread like this unless you are able to fulfill margin requirements with proper funding.
What are the advantages of an Iron Condor Spread? 1)Enjoy an uncovered position by not owning any stock. 2) This option trading tip is for a completely neutral strategy. 3) There is an increase on potential returns thanks to the call and put options. * Controlled risk and lower potential risk due to double credit
Use the Iron Condor Spread if the price of the underlying asset is not expected to change, or change very little throughout the option's life. When the underlying asset is equal to the middle strike, the maximum amount of profit is achieved at expiration. This option trading system allows an admirable range of customization. The following is the profit calculation:
Maximum Profit = Net Credit Profit % = (Credit gained from short legs/greatest difference in strike) x 100 Max Loss = Greatest difference in the consecutive strike a" net credit . When using this formula the maximum profit is limited to the net gained credit. The maximum loss is limited to the level of the maximum calculated loss
The Iron Condor Spread provides a number of benefits, however remember this warning: profiting from the Iron Condor Spread takes time as well as active participation and monitoring, necessitating a proper analysis prior to entry. Additionally high trading levels are needed. Traders who have lower trading levels will not be able to successfully implement the strategy of the Iron Condor Spread.
About the Author:
TheScienceOfTrading.com provides 90 free minutes of videos on option trading systems and provides a complete and detailed stock trading education for beginners to experts.
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11:54 AM
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