Top Reasons Why You Should Learn 90% Probability Index Iron Condor and Credit Spread Options First Before Putting Time Into Any Other Strategy
1) Ninety % Probability Index Iron Condor Options are popular because the are easy to learn, understand, and visualize without the need for complicated and expensive options analysis software. For more on what these trades look like, please go to Iron Condor and Credit Spread.
2) Ninety % probability Index iron condors & credit spreads are popular with professional traders because they produce an excellent return of 25% to 45% return per year, historically. For more details on our returns please visit the ROI Track Record page.
3) Getting on the "other side" of the trade and selling (writing) index credit spreads & iron condors to options speculators & amateurs can change your life financially. As you probably have heard, 80% of option traders who buy calls and puts speculatively lose the premium that they paid to purchase the options; i.e. the options expire worthless. In contrast, by getting on the other side of the trade and selling these calls and puts to the speculators & amateurs, like the "house" in a casino, 80% of our trades are profitable. We actually take a more conservative approach where close to 90% of our trades are profitable. This is why the strategy of selling options can generate a consistent 4% to 6% return monthly.
4) Index Iron Condors & Credit Spread Options represent a non-directional, income generating strategy that makes money when the market trades sideways, is choppy, or moderately trends upward or downward. Thus, you can make money in all market conditions. History has demonstrated that the stock market usually makes big upward or downward moves of greater than +/- 10% in 45 days or less about once per year, and then the market usually remains pseudo range-bound, choppy and/or gradually trends upward or downward for the remaining 10 months of the year. As a result, this strategy is profitable the majority of the year requiring very little effort.
5) Ninety % probability iron condors have fewer losing months/year, about 2 to 3, as compared to 70% probability trades. During the 2 to 3 "difficult months" of the year when the markets move quickly and where we'll most likely have a losing month, because we trade the more conservative 90% probability trades, we have a good track record of historically keeping our losses below 5%.
6) You'll sleep better at night knowing that your iron condor has a very wide "safe zone". When the markets get volatile, 90% probability iron condors give us more time to react and make adjustments if necessary.
7) The Index Iron Condor & Credit Spread Strategy requires only a few hours each week as compared to other trading strategies that take significantly more time and effort. The "traditional" option strategy speculatively buys directional calls, puts and/or debit spreads on individual stocks and bets that the stock or index moves in the correct direction. One of the negatives of directional option trading is that they take a lot more time & effort in identifying the trades, placing the trades and the stop losses, managing the stops and then exiting the trades. In contrast, the non-directional strategy of being on the "other side" of the trade by selling calls and puts to the speculators & amateurs takes less effort and only requires a few hours per week.
8) You'll pay less taxes on your gains. Why? Because we place at least half of our trades on broad-based indexes such as the RUT (Russell 2000 Small-Cap Index) and MNX (NASDAQ 100 Index) which are taxed per the 60/40 tax rule. Section 1256(a)(3) in the IRS tax code states that gains from option trades on broad-based, cash settled indexes can take advantage of the 60/40 rule which states that 60% of gains are taxed as long term capital gains and 40% of gains are taxed as short-term capital gains, i.e. ordinary income. Overall, the 60/40 tax treatment is generous and gives option traders who trade cash settled, broad-based indexes a tax advantage and the opportunity to make higher returns than option traders who focus on other financial instruments such as stocks or ETFs. We do trade a few ETFs such as the SPY that tracks at 1/10th of the S&P500 index, and the gains on ETF options are taxed at one's ordinary income level. Please make sure to talk to a tax professional on this topic as we're not licensed tax professionals and we are not authorized to give tax advice.
9) For investors with at least 2 years of experience in trading 90% probability index iron condors & credit spreads, they could allocate up to 50% of their total portfolio in just a few monthly trades.
If working less than 2 hours per week and sleeping well at night, while generating 25% to 45% return annually, and learning to become a competent iron condor trader sounds interesting to you, please sign-up for a FREE 30 day trial. (no credit card is required) Once you try our service and if you decide you like this strategy, you can continue for $85/month, and you may cancel your subscription at any time.