Example of Stock Iron Condor in AAPL

Example of a stock Iron Condor would be AAPL. I am first using the criteria for a stock Iron Condor from the previous post today and then giving a trade example.

Criteria #1: It’s a stock I would buy 100 shares in my retirement account.

Criteria #2:  Very Liquid stock, AAPL trades around 200,000 option contracts daily, dwarfing most other stocks in Options Volume. Also, AAPL is high enough price, currently at $124.

Criteria #3: AAPL implied Volatility is around 25 for at-the-money calls, I like stock Iron Condors around 25 level.

Criteria #4: If I was putting more Iron Condors on in stocks, I would add stocks from different industries than AAPL.

Iron Condor Trade in AAPL:   Stock around $124. Looking at June 5 expiration, around 30 days from now. Buy 1  138 call and sell 1   133 call.  In the puts, buy 1   110 and sell 1  115 strike. Total Credit for 1 Contract is $110. Total margin or risk for 1 contract Iron Condor is $390.