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Strategies for IRA

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Sizing Iron Condors

Strategies for IRA

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

Our Strategies for your IRA segments focus on defined-risk strategies due to the restrictions IRA traders face. We have talked extensively in the past segments about how we can both abide by these restrictions and also mimic our naked options strategies.

Today, Tom and the Bat build on these established foundations by talking trade size in Iron Condors. IRA traders can treat Iron Condors like Strangles when they buy far out-the-money wings, and do so for much less buying power.

While this is powerful information and very helpful to the IRA trader, an understanding of trade size and risk is required before using this relief to add trades.

Tom gives an in-depth talk on how we love reducing buying power in trades, but that this reduction should not force us to increase the size in the trade. This is because (like we noted earlier) this wide Iron Condor acts like the Strangle, so increasing size after reducing buying power would greatly increase risk. Check out what the guys have to say on this topic above.

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