The Double Barrel Calendar

Just started our new 2 week online class, “The Double Barrel Calendar”, and wanted to share the class trade we put on live yesterday. 

SPX was around 2370. B 1 Apr 5  2390 C and Sell 1 Mar 22 2390 C. B 1 Apr 5  2350 P and S 1 Mar 22  2350 P  .Debit of $14.05 and Margin or Risk of $1405.

Join us in tomorrow’s Class as we analyze this trade and cover more on this interesting strategy that serves as an alternative to the Iron Condor when Implied Volatility levels are low, which they are now. VIX is currently at 11.74.

Iron Condor

The foundation of this strategy as well as an Iron Condor is the short strangle. In this trade, we are selling the 2390 C and 2350 P in the Mar 22 expiration.

Unlike the Iron Condor, which will buy the long hedges in the same expiration, we buy our long hedges in the Double Barrel Calendar in a further out expiration and the same strikes as the shorts. In this trade, our longs are in the Apr 5 expiration.

Implied Volatility

In a  low Implied Volatility environment, this strategy gives us wider room or Breakevens than a single Calendar Trade.

Click the image below to watch a free preview.