Adjusting Iron Condors - trending market

Dan Sheridan recently had a webinar on Adjusting Condors in a volatile Market
powerpoint
Here is a recap of the webinar:

The adjustments are based on a upward trending market, which occur in April-May 2009.

The whole point of making adjustments is so that you can stay in the trade. Staying in the trade will improve your chances of turning the trade into a profitable trade. With you make adjustment the yield will be lower. Condors have high probability of winning, so in the long run you will be profitable most of the time, so it is important that you limit your losses. If you don't you will be eliminated from the game quickly.

1. Roll-up the call spreads. You get out of your original call spread and roll-up the call spread to higher strikes.

2. Buy calls next month out. You protect yourself if the trend continues.

3. No adjustments. You get out if the condor reaches a certain percent loss (e.g 10%). This requires little work, but you need to be disciplined. You need to get out if the loss percents are reached, otherwise your will incur even larger losses.

4. Roll-up and add a call in the next month out. This is a combination of adjustments #1 & # 2/

5. Get out 1/3 of the positions (call spread) at a time for each time you loose 10%.