Master Iron Condors - Double the credit for half the risk

The Iron Condor is one of the most popular Options strategies, and it is the undisputed "King of Time Decay strategies".
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Instructed by Hari Swaminathan Business / Finance
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  • Lectures 7
  • Length 1.5 hours
  • Skill Level Expert Level
  • Languages English
  • Includes Lifetime access
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    Available on iOS and Android
    Certificate of Completion
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About This Course

Published 3/2013 English

Course Description

THE IRON CONDOR STRATEGY - KING OF TIME DECAY STRATEGIES

 

The Iron Condor Spread is one of the most popular trades of all Options trades, and it is the undisputed "King of Time Decay or Income strategies". It is special because you get to double the premium collected, reduce your risk levels as compared to normal credit spreads, double the amount of time decay, and maintain a delta neutral position, at least when the trade is first put on. The negative with the strategy is that it's a heavily Vega negative position. We dissect the Iron Condor in this trade, put on a real trade on AAPL, and take it through a couple of weeks. We analyze the risks, set adjustment points, and discuss suitable adjustment strategies for different market situations as the trade develops. 


What you will master

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  • How do we construct an Iron Condor
  • Why choosing the right strike prices are important for the Iron condor
  • Should we try to make it a delta neutral trade and why
  • What are its special characteristics
  • How is the premium doubled
  • Why is the Iron Condor a popular trade
  • Why are margin requirements less on an Iron Condor
  • What should we watch for in terms of Vega exposure
  • What are good adjustments for an Iron Condor
  • When do we use the simple adjustments and when do we use the complex one
  • Is Rolling an Iron condor leg a viable strategy
  • What are the options if we don't want to roll a losing Iron condor leg
  • Why is there an automatic profit component in an Iron Condor
  • How can we optimize the entry of an Iron condor

 

What are the requirements?

  • Excellent knowledge of Credit spreads and all material before it
  • Excellent understanding of Time decay and Implied Volatility concepts

What am I going to get from this course?

  • Understand what an Iron Condor strategy is
  • Master the trade setup criteria for an Iron Condor
  • Understand the profit mechanics from an Iron Condor
  • Why the Iron Condor is one of the most popular strategies of professional traders
  • What are the danger points in an Iron Condor and how do we deal with them
  • What are appropriate adjustment strategies for Iron Condors
  • How do we manage the losing the side of an Iron Condor
  • What is "rolling a spread" and how can we roll a losing side profitably

What is the target audience?

  • This is an advanced level course, so students must be familiar with Credit spreads
  • Anyone wanting to create consistent monthly income strategies
  • Busy professionals who don't have much time to look at the markets but need a reliable risk-defined strategy for monthly income

What you get with this course?

Not for you? No problem.
30 day money back guarantee.

Forever yours.
Lifetime access.

Learn on the go.
Desktop, iOS and Android.

Get rewarded.
Certificate of completion.

Curriculum

Section 1: Introduction to the Iron Condor Strategy
13:40
What is an Iron Condor strategy, and why is it called an Iron Condor. This lecture explains the basics of an iron condor, its construction and analyzes the time decay and Volatility considerations. Please also see supplementary video
Section 2: Putting an Iron Condor on Apple (AAPL)
13:34
A detailed analysis of an Iron Condor trade on Apple (AAPL), before the trade is executed.
Section 3: Iron Condor Trade Management
19:02
After we put the Iron Condor on AAPL, what is the stock doing and how do we manage this position.
06:42
The mechanics of how the Iron condor makes a profit, and what are the considerations for a great exit on the trade
Section 4: Iron Condor adjustments
12:20
An overview of the two most common (or simple) adjustments for the Iron condor.
10:45
This is a more complex but very effective adjustment for Iron Condors. We show you exactly how to take a losing side of the Iron condor and "roll it" into the next month in a profitable manner, and in a way that recovers its current losses
06:40
A wrap-up of this amazing strategy. Includes a couple of advanced tips on how to maximize trade entry for Iron condors using a very nifty technique.
Iron Condors Quiz
5 questions

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Instructor Biography

Hari Swaminathan, Options Mentor, Financial markets educator, Trader, Investor

Knowledge. Strategy. Execution.

Hari Swaminathan is the founder of OptionTiger, a cutting-edge Options Mentoring company, and a full-circle educator in all areas of Financial Markets, and developer of proprietary Intellectual Property around enhancing base case Options strategies (which favor the Market Makers) and turns that deficit into a massive EDGE on the trader's side.. Like building a "powerful Strategy for all Option Strategies". Hari is self-taught in Options and actively trading these instruments for almost 10 years. Hari has a Bachelors degree in Engineering from India, and MBA's from Columbia University in NYC and London Business School in London UK. 

More than ever, its become important for normal people to take charge of their financial situation, and attempt to create additional income streams, or build wealth for the Long Run, in a smart, risk-controlled manner. This is precisely my mission. Through Knowledge, Education, and disciplined Money management approaches. Video-based courseware, Practical workshops , a 4-week Live Mentoring program and several other channels.

Let's break down the Options game in a brutal but realistic manner. 

The Pluses

1. Options were invented out of thin air. And the people who invented it won Nobel Prizes for their invention (Fisher and Black). It is purely a "Mathematical" concept, with no real connections to the external except for one, that's defined implicitly  by its deign.. Its the relationship between an Option and any Asset in the real world,.The associated relationship with any asset's price behavior in precisely defined time frames. In common language, it tries to answer a fundamental question underpinning all of humanity. What kind of mathematical model can help us define the risk of certain events happening, or not happening. The model is very similar to the Insurance industry who basically provide the odds calculated bty large and wide samples of data. It's only then they can provide somewhat of an accurate quote, based on Data science, Statistical Modeling and a heavy dose of Probability theory.

2. This gives birth to very complex but interesting  analytical scenarios. It also gives us the ability to model Options with a set of tools like a car dashboard., but much more powerful and sophisticated approaches. In many cases, you don't need to see what the stock or the larger markets are doing. These numbers are embedded in the mathematical formulas that underpin Options.

3. Because everything in Options is defined in mathematical terms, its also important to realize that OPTIONS will always be the same. The math behind Options will always be the same. forever. Unless they discover serious flaws iin the formulas that tries to determine the fair Option price based on the kind of asset, its price action, Highs and Lows as defined in statistical terms over a certain fixed time frame. It should make some amount of intuitive sense, even if you can't nail it precisely at first..Things like Price Volatility in the "underlying asset, the time lkeft for the Option to expire (Every Option is created with a fixed period of life, and all Option die at some time (They expire) . But the short life that many Options go through, its a wild life, filled with roller coaster like adventures,. 

4. As an analogy, you can make comparisons with the game of Chess. You may agree that Chess is a game of "skill". It's a game of strategy and how well you can plan (ahead) to attack, defend or take a neutral position . We also believe that Chess is strategy-focused and depends upon certain mathematical  properties. The reason we know its a game of skill is : Try to play 100 chess games with Kasparov or Anand. Normal people are guaranteed a loss in all 100 games. And why do we know its underlying features are mathematics based L The reason that computers like Deep Blue can beat Kasparov by a majority, and as computer processing power has increased exponentially by many 1000's of times,, the human number crunching powers have pretty much been constant. So today all professional Chess players refuse to play the machine, because while they used to lose to them by majority, today it's almost guaranteed that they WILL LOSE EVERY GAME

5. Lastly Options are just like Chess. They are a "skill set", and requires acquiring a deep set of analytical skills much more so han most skill sets, but can only be  mastered over a period of time. We cannot turn into a Kasparov in a matter of weeks or even a few month. It does NOT work like that. But once you go through this process that can go for 1 to 2 years or more, there is a powerful light at the end of that tunnel. You build a skill set for life which means things like Age or geographical location, Lifestyles, Weather are no longer a barrier to create a consistent income streams strategically regardless of who you are, where you are, or how old you are. This is POWERFUL stuff. Now let's look at the negatives.


MINUSES


Options are easily the most fascinating financial instrument with several upside benefits, but they an equakky powerful set of minuses. 

1. Options have a steep learning curve. Gon't expect to become Kasparov in a couple of months. Or even a year or two. You caan bbuild a Kas[arov or Anand in those timeframes. And why is this important to realize, Because we are playing a Kasparov or Anand every time we enter the Options market. Market Makers who are 99% of the time, the counter party to all Options trades, are Options professionals. with 10 to 20 years with exoerience in Optioms. . The company has entrusted the responsibility of providing liquidity to the market which is a :legal duty" but can have disastrous consequences. While we have hours tp plam our attaacks, the Market Maker literall seconds for a trade. In a normal  day, a market maker can do many thousands of trades. One can omly be in awe of their skills. 

2. If you're interested in Options, sp=o NOT approacg it with a mondset of or rewuirement to ,aking ,omey. This is not only npu goimg to happen, but iys a recipe for disaster. It's like a student of Medicine waning to ptactice thei skiils after 2 monyjs of study, Keepimh with the Chess analogy,, because its the best way to think about Options before you actually know Options. To develop a meaningful batting average, you will need Time, Patience, and Disipline. They domt develop overnight. Ifyou focus completely on the learning ideally practicing on paper money accounts

are powerful, but they have a learning curve. I've broken down all the complexities of Options in simple language that everyone can understand. The courseware uses real trade examples, always highlighting the pluses and minuses of every investment situation. Options provide the best way to take advantage of bull cycles, bear cycles and everything in between.

As someone that has self-learnt Options and through making mistakes, I can tell you Options trading is not something you should take lightly. You will hear people talking of fantastic triple and quadruple digit returns. I'm here to be brutally honest with you - 

- Be very very careful in the first 12 months of Options trading. 

- This is when everyone is the most vulnerable to losing money. 

- Your main objective during this time is to focus on learning this craft and not lose money during this time. 

Having said that, if you can get past the first 12 months and acquire the expertise in a systematic manner, true financial independence awaits.

You can trade Options from anywhere in the world, regardless of how old you are. You never have to worry about job security any more because you have a skill that can produce consistent wealth month after month. 

But you have some serious but exciting work to do before you can get there, and I'm here to help you in this journey. 

Watch my Free Course for Options Trading Beginners where I draw out a detailed roadmap of what this 12-month journey looks like, and the specific strategies you should master during each step of this learning process. 

Watch my Free Mini-courses or my YouTube channel , all of which have the highest quality of education material. 

And join me in my UDemy courses, where I share cutting-edge theoretical knowledge mixed with practical insights, strategy and impeccable execution through live trading examples. 

If you have any questions at any time, please feel free to message me on Udemy.

The order to follow on my Udemy courses

Comprehensive guide to Financial Markets, Investing and Trading

Options Trading Beginners Bundle (3-course Bundle)

Advanced Options Concepts

Options spreads and credit spreads Bundle

Technical analysis and Chart reading Bundle

After this, the order does not matter. You can take any of the courses as per your interest.

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