Weekly Iron Condor

Maximum profit is the credit received. For example, a 30-point credit on a 50-point wide condor means £300 max profit (at £10/point). Realistically, target 50% of credit (£150 in this example) to manage risk. Monthly returns of 2-5% on capital at risk are possible but not guaranteed.

If price is between your short strikes, all options expire worthless and you keep 100% of the credit. If price is outside your short strikes but inside your long strikes, you'll have partial loss. If beyond long strikes, you'll have maximum loss. We recommend closing Thursday to avoid Friday's gamma risk.

Weekly iron condors typically require £5,000-10,000 minimum to properly size positions. With smaller accounts, you may only be able to trade 1 contract, which doesn't allow for proper diversification. Consider building your account first or starting with single credit spreads.

With proper strike selection (15-18 delta), expect to win about 70-80% of trades. This means 2-3 losses out of every 10 trades. When you lose, the loss is typically larger than your average win, so position sizing is crucial for overall profitability.

FTSE options are traded in GBP with £10 per point, settle on Friday morning, and have moderate liquidity. SPX options are traded in USD, have excellent liquidity, and settle PM or AM depending on the series. SPX offers more strike choices and tighter spreads but requires currency exposure.

Yes, close at 50% profit regardless of timing. Risk/reward deteriorates after 50% capture - you're risking more to make proportionally less. Closing early also frees capital for the next week's trade. Many professional traders find this rule improves long-term returns.

If the market gaps through your short strike, close the position immediately at the open (both spreads or at minimum the tested side). Don't wait hoping for reversal. Gaps often continue in the same direction. Accept the loss and preserve capital for future trades.

It depends on your goals. Tighter spreads (25-50 points) give higher credit percentage but faster movement to max loss. Wider spreads (75-100 points) provide more buffer but lower returns. Standard 50-point spreads balance these factors. In high VIX, go wider; in low VIX, tighter may be necessary for acceptable credit.

Diversify but remember correlation - SPY, QQQ, IWM often move together in crashes. Limit total exposure to 6-8% max loss across all weekly condors. Track aggregate delta to ensure you're not accidentally too directional. Consider adding uncorrelated assets like FTSE or commodities.

Avoid when: VIX is above 30 (extreme volatility), major events this week (Fed, CPI, major earnings), strong trending market, or you can't monitor positions. Also avoid if you've had 3+ consecutive losses - take a week off to reset and review your approach.

Analyze the IV skew to identify which side offers better premium for the risk. If put skew is steep, the put spread may offer better credit. Compare near-term IV to further-dated IV (term structure) - backwardation means better weekly premiums. Use these insights to tilt your condor toward the richer premium.

Use tick-level or at minimum end-of-day option data for 3+ years. Simulate entries based on your rules, track daily P&L through each week, and apply exit rules mechanically. Use out-of-sample validation (test on data not used in development). Account for bid-ask spread and commissions. Walk-forward optimization helps avoid overfitting.

Options include: (1) VIX calls - buy monthly OTM VIX calls sized to cover catastrophic losses; (2) Far OTM index puts - direct hedge; (3) Dynamic hedging - add puts when VIX rises above threshold. Budget 10-15% of expected premium for hedges. The goal is portfolio survival, not elimination of all risk.

Weekly condors can complement: (1) Monthly iron condors - laddering for diversification; (2) Long volatility positions - provide hedge for condor's short vega/gamma; (3) Gamma scalping - offset short gamma with scalping profits; (4) Dispersion trading - sell index condors, buy single-stock gamma. Consider correlation between strategies.

Features like VIX level, IV rank, term structure slope, and technical indicators can predict weekly range. Models can optimize delta selection, entry timing, and position sizing. However, markets adapt, so out-of-sample validation is crucial. Ensemble methods and regime detection often work better than single models. Start with simple logistic regression before complex deep learning.