Iron condors and other credit spreads Message Board

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Strategies & Market Trends : Iron condors and other credit spreads

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From: Dalek	11/8/2005 10:05:24 PM
	of 37

Hi - I also trade OTM iron condors, mostly on indices (OEX, SPX, RUT). I am trying to fill in some of my knowledge gaps! When deciding what strikes to use I currently look way OTM (until premium drops to around 10%ROI), check resistance and trends in the graph and a few other indicators, and trade with around 1 month to run. (Or I use the graphs on optionsrez). I have looked at the parameters used in the optionsrez graph but the langauge is a little beyond my knowledge base at the moment! I would like to use standard deviation on price over the last month (or two) as an indicator. I figure one standard deviation in price would cover 67% of price variation, and two SD would take that to about 95%. That sounds pretty good. Short of calculating the SD myself, I presume one of the common indictors used would provide this info. (I know bollinger bands measure 2 SD on the moving average but over what time?) Can anyone tell me which indicator to use/how to interpret the information to get a measure of SD over the last month? I would like to test this information against my past condors and see whether it would be useful for defining the strikes. Also has anyone looked at trading condors on $SML. I had a look earlier in the month and had quite high ROI with wide break-evens. Cheers and safe trading

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