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IRON CONDOR TRADING PLAN
Overview
This trading plan is designed to help improve overall trading results by setting rules and
guidelines to follow at all times.
Objectives
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Annual - between +15% and 25% total return on capital
Monthly – To be profitable in 10 out of every 12 months and 80% of all trades.
To keep a trading diary and review it weekly
To avoid large losses
Selecting a Market
Trade the following instruments:
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RUT, SPX, NDX
Capital Allocation
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$40,000
Selecting a Trading Style
Trading will focus on monthly Iron Condor trades with between 30 and 45 days left to expiry,
with an aim of generating consistent monthly income while minimizing losses.
Entry Guidelines
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Delta of short strikes around 8-10
Open the position on a down day (higher VIX)
Aim to enter sold strikes below recent support and above recent resistance
Aim to generate 10% income per trade
Options Trading IQ. All rights reserved. Copyright 2016
Exit Guidelines
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Profit Target $1,000
Stop Loss $1,000
If the trade has been adjusted 2 times and needs a 3rd adjustment, the market is trying
to tell us something and we should close the trade.
Adjustment Guidelines
When determining when to adjust, we will monitor the following
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Spread Value
o If spread value rises by 200%. I.e. if $100 in premium income was received on
one side, adjust once that side of the spread rises to $300 (a $200 loss).
Short Option Delta
o If short option delta reaches 25
Distance To Short Strike
o If underlying gets within 3% of the short strike
Delta Dollar Exposure
o If delta dollar exposure reaches +/- $80,000
Options Trading IQ. All rights reserved. Copyright 2016