When

trading an IRA account we are unable to

trade short naked calls. This means no naked
strangles or straddles.

We can however trade call spreads and cash

secured naked puts.
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We can combine a cash secured put and call

spread to create a Jade Lizard or Big Lizard*,
both with no upside risk. We may look to do
this in High IV underlyings aHer a recent sell-
o.

*Market Measures - Big Lizard 12/22/14

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An example of this can be seen in IWM. IWM

has experienced a recent sello and
consequently has an Implied VolaQlity (IV)
Rank of 81%. SPY and QQQ are both around
65% currently, hence we are favoring IWM.
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Today, we will look to take advantage of this

high IV Rank by placing a Big Lizard. Using
the Feb opQons, we will sell the at-the-
money (117) Straddle and dene our risk to
the upside by buying the 123 call for a total
credit of $6.30.
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IWM Big Lizard (Sell 117 Call and Put, Buy 123 Call)
POP 73%
Margin $11,670
Max ROC 5.39% ($630 / $11,670)
ROC at 50% Management 2.695% ($315 / $11,670)
Downside Breakeven $110.70
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DISCLAIMER: The purpose of this material is to demonstrate market trading techniques and strategies designed to give you the skills and
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