Time Decay in Value is Part & Parcel of Option Trading - It Can Work for You Too.
SPY Monthly Chart with Pivots showing S3 and R3. The chart shows a gradual bullish trend month to month but at the same time not excessive volatility. This sideways movement in the market is true 60% of the time. This is a perfect scenario for an Iron Condor. Out Target for expiration in Jan. is 112.
The VIX (Volatility Index) also shows a sideways movement between 20 and 24. This simply confirms the present state of the market. The VIX performs counter to the market in that Up in the Vix is Down in the Market.
SPY Iron Condor showing a growing profit profile. The current price of the SPY is about 111.00 As long as the SPY stays between 107 and 117, the trade cannot lose money. If the price stays where it is the return could be 40% over a 5 week period of time. There are some variables and uncertainties, but the Iron Condor does offer relatively safe alternatives as compared to Directional Day Trades. Put Time Decay to work For you and not Against you.
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