Thursday, 24 November 2011

How to trade Volatility with Options

By Donald Scott


When the IV of the market or the "volatility" is moving downward and the market is going up, you would think that this would be the right time to trade the "Iron Condor." Because the "Iron Condor" is a negative Vega option spread, it works very well when the "volatility" is moving downward. If you do not know what Vega means when it comes to options, then you would really benefit by taking your time to visit www.sjoptions.com and watch their free videos on the Option Greeks.

Since the "Iron Condor" is a negative Vega strategy, this should be the right time to use this income option spread (when we wrote this article the volatility in the market was dropping). Today's market has made it a pretty decent time to manage this option spread now that the volatility has been moving downward, and the markets have become a calmer place to be. Because of this mellow market many of the income traders have been making money with the stock market over the last few months.

Wouldn't you like to relax, enjoy your life, and make money nearly each and every day, without much work? I sure would! With the "Iron Condor" it can be done! It's really a wonderful way to live when the market gives you this kind of opportunity. But don't be fooled, this is not possible all the time, but some of the time, yes, it is.

Now, I have to say, that I have had the chance to learn a much better, very different, and safer way to trade the "Iron Condor". I learned this revolutionary way of trading by studying with San Jose Options. While most option teachers teach you a more aggressive way to trading the Iron Condor, I now can sleep longer in the mornings and live with less stress, knowing that my option trades are not being exposed to high risk, and knowing that my portfolio is safe. While other people have to get up at the opening of the stock market each day because they may have to make some changes to save their money, I can sleep in.

Before learning this much needed, safer, conservative way of trading, I was doing adjustments almost every week to my portfolio at attempts to preserve me capital. Lately, I have been making about 10% per month with very little changes at all. Now that I have a much safer way to create the "Iron Condor" from the beginning, I have fewer changes to make while I am in the trade. Over all it has been really nice trading the stock market for the last few months.




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