If GLD Stays Range-Bound Between ±2% This Strategy Will Yield 52%

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This GLD Iron Condor Aims for 52% ROI in 6 Days

Outlook is neutral, with stock confined to a span of ±1%

Strategy has +52% ROI potential and 7% overvalued

Buy218 Put
Sell221 Put
Sell227 Call
Buy230 Call

SPDR Gold Shares price is now up +2.3% today to $223.61. Over the last two weeks, the stock has traded between $214.45 and $221.28. Based on historical stock price behavior, this spread for GLD has a theoretical 71% success rate.

Option Profit Calculator for GLD Iron Condor at 19-Jul-24 Expiration

If GLD stock price at expiration is between $221.00 and $227.00, this spread has a 52% upside potential

As you can see in the chart above, the ideal outcome is for GLD stock price to close between $221.00 and $227.00 at the July 19, 2024 expiration. Within that price range, all of the options will expire worthless, and you'd keep the original $1.02 credit you received at the time of the trade.

The maximum gain will be realized if the stock price is between $221.00 and $227.00. The maximum gain is $1.02

The maximum loss would occur if the stock price at expiration is below $218.00 or above $230.00. The maximum loss is $1.98

GLD Spread Current Market Price vs. Historical Average

GLD Iron Condor is trading at a 7% premium to historical average.

Using historical data to measure how a similar spread in GLD was priced in the market, the 4-year average value was 0.95, with a high mark of 1.42 and a low of 0.68.

Currently, this iron condor is bid at 1.02 and offered at 1.10. The midpoint of the spread is 1.06.

If we use 0.95 as our historical fair value benchmark, the current market bid price is at a 7% premium, while the current market midpoint represents a 12% premium.

Current PriceHistorical Values of Similar Iron Condors
Market Chameleon captures daily records of market data to calculate historical benchmarks and generate estimated values.

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NOTE: Stock and option trading involves risk that may not be suitable for all investors. Examples contained within this report are simulated And may have limitations. Average returns and occurrences are calculated from snapshots of market mid-point prices And were Not actually executed, so they do not reflect actual trades, fees, or execution costs. This report is for informational purposes only, and is not intended to be a recommendation to buy or sell any security. Neither Market Chameleon nor any other party makes warranties regarding results from its usage. Past performance does not guarantee future results. Please consult a financial advisor before executing any trades. You can read more about option risks and characteristics at theocc.com.

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