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June 16th, 2011 at 11:58 am
I do have a couple questions about the adjustment process, I remember reading something about these details but can’t find the post anymore.
Is it best to just close the entire position at once, and then initiate a new order for the new Iron Condor? I know if you try to close just 1 segment at a time like selling all 35 puts at once, it wouldn’t go through due to buying power. Also in this example what would be the goal for net premium?
About insurance, Can you briefly explain what this does? I know that it would increase in value as the RUT continued to fall (if it did). Is that it’s main purpose to offset the losses you incur on the short put during the .12 and .2 delta that the insurance is used for?
Sorry if these questions are obvious. I’m learning so much with these posts, thanks!