Unbalanced IC

It depends on which side gets tested. The wider side has more max loss potential, but the narrower side has less. Overall risk can be similar if sized properly, but the directional exposure is different.

You might have a directional lean (slightly bullish = accept more downside risk), or you might be capturing extra premium from skew (puts often trade richer than calls). It's a way to express a view while staying range-bound.

Yes. Both sides are still defined-risk credit spreads. The total max loss is known upfront (larger side minus credit), making it TFSA-eligible.

Wider side = more risk accepted on that direction. Bullish? Wide put spread. Bearish? Wide call spread. Exploiting skew? Usually wide put spread (puts are typically richer).

No. Skew exists because crash risk is real - markets fall faster than they rise. You're being paid extra to accept tail risk. Don't oversize; the premium is compensation for real risk.

Generally, keep width ratio ≤3:1. Beyond that, the position becomes more of a directional bet than a range-bound strategy. 2:1 is a reasonable starting point for most situations.

Monitor position delta daily. If it drifts beyond ±20-25 due to stock movement (not intentional bias), consider adjusting. Options: close part of position, hedge with shares, or adjust spreads.

Yes. If your view changes, you can: (1) Close position entirely, (2) Close one side and adjust width, or (3) Add to the other side to rebalance. Don't stay in a position that doesn't match your current view.

If puts have higher IV (skew), a general IV drop may benefit puts more. Your wider put spread would benefit more from IV crush than the narrower call spread. This is part of skew exploitation.

Yes. Roll each side independently if needed. You can also rebalance during a roll - e.g., roll to a balanced position if your view has become neutral.

Calculate 25Δ skew (put IV - call IV) daily. Compare to 1-year percentile. Above 80th percentile = rich skew opportunity for unbalanced condors. Backtest your threshold before trading.

Calculate: Extra put credit / Extra put max loss. If you collect $0.13 extra for $0.87 extra risk, you need put side to succeed 15% more often (relatively) to break even. If skew exceeds this hurdle, edge exists.

Vanna (delta sensitivity to IV) matters because IV changes affect delta differently on skewed positions. Charm (delta decay) affects both sides but timing can differ. Monitor but don't over-optimize for these effects.

Depends on total portfolio delta tolerance. If unbalanced condors add +50 delta across 5 positions, ensure this aligns with portfolio objectives. Cap total condor delta exposure to what you're comfortable with directionally.

Need historical option prices by strike and IV data. Simulate entries based on skew signal, track P&L through expiration, compare to balanced condor baseline. Key metric: does skew capture add risk-adjusted return?