Hey guys, i want to know about the concept of put skew and smirk / smile concept. Generally puts demand higher premium than calls, in this case if we want to hedge our position in iron condor – Straddle + Wings. So suppose spy trades at 550 with straddle at (1.25+1.31 = 2.56). So if we want to hedge this position by going 5 strike wide we see puts hedge of 545 at 20 cents and call at 4-5 cents or maybe 7-8 cents max. So even at same distance, we see puts demanding higher premium than calls in hedging this position. TastyTrade did some research on this topic, i wanted to know if we should hedge our position at similar premiums or similar distance?? Suppose 540 puts trade at 7 cents and 555 calls trade at 7 cents too so should we hedge this position where distance of puts is 10 strike and calls is 5 strike. Or for Iron condor the distance from the sold wings should be similar and we should pay a higher premium for hedging puts. Any views on this?? I am not able to find the video tasty did on this. Thanks 🙂

    Iron Condor Hedging Delta
    byu/TradingBulls07 inoptions



    Posted by TradingBulls07

    1 Comment

    1. Why did you mention delta in the questions header? Seems you don’t care about it in your actual question.

      What is your objective with hedging?

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