Robinhood Options Trading Spreads

Robinhood options trading spreads

Robinhood options trading spreads

How does entering an iron condor affect my portfolio value?

When you enter an iron condor, your portfolio value will include the value of the spreads. Since this is a credit strategy, you make money when the value of the spread goes down. Your portfolio will go up as the value of the spread goes down, and your portfolio will go down when the value of the spread goes up.

Where can I monitor it?

You can monitor your iron condor on your home screen, just like you would any stocks in your portfolio.

Robinhood options trading spreads

You can find information about your returns and average cost by tapping on the position.

Can I close my iron condor before expiration?

Yes! You can close your iron condor spread in your mobile app:

  • Tap the option on your home screen.
  • Tap Trade.
  • Tap Close.

Why would I close?

The main reason people close their iron condor is to lock in profits or avoid potential losses.

If there are only a few more dollars that you can make, it may make sense to close your position to guarantee a profit.

Can I exercise my iron condor before expiration?

No.

You don’t really have control in this strategy because it’s a net credit strategy which means that you’re profitable if you don’t get assigned on the option that you’re selling, and it expires worthless.

Can I get assigned before my contract expires?

An early assignment will typically only happen if the stock moves drastically in either direction.

Robinhood options trading spreads

If you get assigned, you’ll have to buy or sell 100 shares of the underlying stock before expiration.

If you get assigned on the call, you can buy 100 shares of the underlying stock at the higher strike price or less, depending on the stock’s current market value.

If you get assigned on the put, you can sell 100 shares of the underlying stock at the lower strike price or more, depending on the stock’s current market value.

You’ll typically only get assigned on the calls or the puts because only one of them can be profitable at a time.

What happens at expiration when the stock goes:

Above the High

If both calls are in the money, it’s very likely that you’ll get assigned on the contract with the lower strike price.

If this is the case, we’ll automatically exercise the contract with the higher strike price, and you’ll lose the maximum amount.

In Between the Calls

If this is the case, we'll automatically close your position.

How To Buy And Sell A Credit Put Spread On Robinhood App Options Trading

Depending on whether you’re above or below your break even price, you can still make or lose money.

In Between the Calls and Puts

If this is the case, you’ll keep the maximum profit. We’ll automatically let all four contracts expire worthless, so you don’t need to worry about checking the app.

In Between the Puts

If this is the case, we'll automatically close your position.

Il&fs transportation ipo price

Depending on whether you’re above or below your break even price, you can still make or lose money.

Below the Low

If both puts are in the money, it’s very likely that you’ll get assigned on the contract with the higher strike price. If this is the case, we’ll automatically exercise the contract with the lower strike price, and you’ll lose the maximum amount.

Keep in mind

If the stock price is close to any of your strike prices, we’ll automatically close your position.