The Dow held up while the Nasdaq sold off hard in the sector rotation, so this week's free trade leans against it: an iron condor on DIA into December, built slightly bearish. It is for anyone who is already long and scared of the market going down, the same thesis as the SPY condor from Oct 20, which also looks only slightly bearish but has its P&L curve bent to the bear side. SPY comes off at day 21, DIA at day 16, because it was entered at 44 days to expiry or less.
On screen the condor goes on live, 43 days out: sell the 480 put and the 530 call, buy the 470 put and the 540 call. Then the question from the chat: why does skew make a neutral condor bearish? Because everyone sells covered calls for extra premium and everyone buys puts as insurance, so calls are cheap and puts are expensive. And a call credit spread beats a covered call every time, because the short call alone is a terrible product and owning the shares does not fix it.
The rest is the week's lessons. TLT on a hard down day: why you can be down when the chart is fine, the sweet spot in the middle of the profit zone, and why theta burn has to be weighed against gamma risk instead of waiting for the last bit. IGV, exited yesterday at 32 percent of max loss on a one to two risk return, after the 50 percent Fibonacci bounce got sold into. And XLE: the rule said day 21, implied volatility pushed the condor to the edge, I got out negative, and a few days later it sat at max profit. That is fine. That is the rule.
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Education only. Nothing here is investment advice. Options carry risk, including the loss of the whole stake.