March 2011 RUT Open

March RUT Iron Condor spread opened on 2/22 was a 730/740 – 870/880. RUT was trading around 808 (130 point spread). A little bit larger spread after getting royally burned last month.

First March RUT Spread

  • Buy 730 Puts @ 3.99
  • Sell 740 Puts @ 4.91
  • Sell 870 Calls @ 1.27
  • Buy 880 Calls @ .79

* Net Credit: $1.40 per share or $140 per contract (each contract is 100 shares)
* $1000 margin requirement per contract
* $140 / $1000 = 14% return on investment
* Total potential loss of $860 ($1000-$140) per contract

I also opened a second 730/740 – 875/885 March RUT spread. RUT was trading around 808 for the lower put leg, and 825 for the upper call leg (135 point spread).

Second March RUT Spread

  • Buy 730 Puts @ 2.70
  • Sell 740 Puts @ 3.44
  • Sell 875 Calls @ .90
  • Buy 885 Calls @ .45

* Net Credit: $1.19 per share or $119 per contract (each contract is 100 shares)
* $1000 margin requirement per contract
* $119 / $1000 = 11.9% return on investment
* Total potential loss of $881 ($1000-$119) per contract

Visit The options guide for details on Iron Condors and other option trading strategies.