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New Income Trade in IWM

Home › Forums › Income Trades › New Income Trade in IWM

  • This topic has 1 reply, 1 voice, and was last updated 8 years, 6 months ago by Steven Place.
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  • November 29, 2013 at 2:54 pm #2217
    Steven Place
    Keymaster

    I normally look at the RUT (cash settled index) for this kind of trade, but there’s not much liquidity there so I will just go in with more size on the IWM.

    Remember, IWM is 1/10th the size of RUT.

    Here’s the trade I like:

    Buy IWM Jan/Feb 112 Put calendar at 1.00 or lower

    Starting with 1/3 size here with intent to add if I get into negative theta territory.

    Profit target is 20% on debit so about 20 bucks per spread.

    iwm

    December 20, 2013 at 9:48 am #2218
    Steven Place
    Keymaster

    After some bouncing around the calendar strike, the trade is showing a nice profit of around 15% ROI.

    I want to close out here becuase I don’t think IwM will stay at these levels for much longer.

    iwm

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