Selling Iron Condors on AEX Index

On October 10, 2019 I made my first Iron Condors trade on AEX index.

The AEX index, derived from Amsterdam Exchange index, is a stock market index composed of Dutch companies that trade on Euronext Amsterdam, formerly known as the Amsterdam Stock Exchange. Started in 1983, the index is composed of a maximum of 25 of the most frequently traded securities on the exchange. It is one of the main national indices of the stock exchange group Euronext alongside Brussels' BEL 20, Paris's CAC 40 and Lisbon's PSI-20.

Iron Condors are not my favorite trading technique (verticals are), but as I was entering to trade a derivative I'm not very well familiar with (like SPX) I decided to play safe open far out of the money wings on both sides (as was not sure of the direction the index will move)

AEX index was chosen because I have a Dutch-based brokerage account and my broker offered a much lower commission on European options - I decided I could add some European instrument for trades

Date: October 10, 2019

Index Price: EUR 561.64

Trade Set-Up:

  • Sell 1 AEX Oct 18th, 550 puts @ EUR 2.02
  • Buy 1 AEX Oct 18th, 548 puts @ EUR 1.71
  • Sell 1 AEX Oct 18th, 580 calls @ EUR 0.67
  • Buy 1 AEX Oct 18th, 582 calls @ EUR 0.47

Premium: EUR 51 Net Credit
Maximum Risk: EUR 200 (EUR 159)
Potential Return: 25.5%

I'm planning to keep the trade until the expiration or adjust legs if needed.

 

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