How to Trade the Iron Fly Strategy | Options Trading Concepts

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[Jallah-Tafari]

FINALLY!!! Somebody who explains WHY they are doing what they're doing. Thanks.

[Catalystgo]

Mike how comes you're so good at explaning this. I understand everything, but if I were to try and explain this to someone, it would be no way this articulate. Do you explain this a lot or do you just know it so well?

[jakeo]

This is a good video. It is geared toward seasoned traders who understand options very well. Amateur traders would be lost within seconds.


I would add few things.


First, there is nothing to stop you to trade it in your IRA account. You just need to sign some agreements with your broker. Most brokers don't have these particular strategies in their option lists, but you can easily assemble short ironfly from two "Combo" strategies. These are available at Fidelity.


Second, he should have mentioned that this was a short ironfly (there is also long/reverse ironfly). You make money when underlying asset stays flat at expiration. It's a good strategy to do in the summer when volumes are low and markets don't move much (usually).

[ameangalindo]

So the break even for this trade is 82.50 and 77.50? And anything in between these two break evens is profit. I love it

[grantgre]

You’ve probably done this already but I would like to see an example of a successful straddle and a successful iron fly N the basis for which you chose those strategies at that time?

[matthewgeorge]

Thoughts on choosing your long option strikes based on delta like one would with a dynamic iron condor? With your short options ATM (50 delta) this would be like 25/50/50/25? -ish? Any backtesting done in this area?

[edgargalicia]

Wich delta do you recomend to used on the long options?

[devarajkrishnamoorthy]

Hi, Is it ok to keep break even levels as stop loss, to exit the trade and enter a fresh iron butterfly trade. your insight in this matter will be greatly appreciated. thank you.

[syco]

Can you risk getting assigned on either of the short strikes intraday if you open the position at market open and close the position before market close? There will still be extrinsic value in the ITM short strikes so I don't think it's likely to get assigned if that's the case.

[martintassin]

Please forgive my confusion here, but other literature talk about a straddle as a defined risk strategy. Your max loss is the premiums you pay for the long put and the long call. Can you help clarify my predicament.

[DroneReed]

Is there such a thing as Reverse Ironfly(Long vs Short), and if so is it also worth considering?

[Lil_mar]

interesting to think about only closing the short that's ITM

[elroyblackbean]

I don't see this as an pre-built strategy on the Tasty platform. Is it considered something else now?

[VinoWoods]

Great video! Question, let’s say you took in a credit of $5. Then you bought the call/put at $5 away from the short call/put. Would that make the position at zero risk?

[parijatsinha]

typically what should be the position sizing for this strategy

[henrytaverner]

Is it better to do this trade in high or low IV instrument?

[brandonlow]

Hi Mike, how do we adjust iron fly if they goes wrong?

[moviesworld]

@tastytradermike
is this for telegram or which social media ?

[Edan]

does the distance between the short ATM options and the long call and put options have to be the same?

for example, could I sell a put and call at the 26 strike, and then buy the put at the 23 strike and the 30 call strike?

how does this effect the trade?

[onuregriboz]

Hi. This is a tax question but i hope someone can help here. If i roll my short option that is in red at the moment into next year, can i write off the loss from my taxable gross?? And if i profit next year, can i put it into my next years gross? I m moving to a lesser tax state, so it could be important.