Weekly Iron Butterfly Backtest (Part 10)

In this blog series, I’m backtesting the weekly option trade described here.

Week 9′s trade begins like this:

The market rallied and then pulled back over the next couple of days.  While a downside adjustment point was hit on Day 2, I did not adjust because the trade was profitable:

The profit target was hit on Monday morning:

P/L on Day 1 ranged from -$372 to -$81.

P/L on Day 2 ranged from +$117 to +$285.

On Day 5 (nothing happened over the weekend), the trade was closed for a profit of $459 on a margin requirement of $3,618, which is a return of 12.7%.

This trade has won in five out of nine weeks thus far.