How do you guys prefer to put on your short iron condors? Do you put the position on as a whole package or do you do the short call spread and short put spread separately? What stop loss strategy do you guys have in place if the equity/index moves the wrong way? How much room do you guys give your self between the short leg strikes and the equity/index price at the time of the trade execution? Thanks everyone.
I don't trade IC's but put protected strangles. I prefer to put them on as a package. I manage risk when position delta exceeds predetermined levels. I'll use a risk reversal on the upside, covering my short call and selling long put. I buy strangles back on the downside.
well that's a mouthful. I execute in 2 strangles - long the wings first then short the gut. Seems to get filled faster that way in my experience, usually I am on mobile so need the fill asap and cant play around with the order. And if you doing short ic, just flip long the gut first then short the wing.
Generally, I put them on as a single spread order, however occasionally I may split them up, depending on market conditions. My stop-loss strategy is fairly simple, I exit the position when the market price doubles. So, for example, if I sell an IC @ 3.5, then when it hits 7 I get out. As to the width of the range, it's not a fixed number, but rather a dynamic thing depending on volatility and various other factors at the time of the trade.
GM All, I have a question about spread execution, and started this thread: http://www.elitetrader.com/vb/showthread.php?s=&threadid=228250 Can you please take a look and answer if you can. Thanks, redduke