In your experience in trading iron condors, is there a simple and "safe
strategy" for steady income out there, which if used over and over will
result in a outperformace on the index ?
Just curious as getting into
this world now (have been in stocks and futures for 15 yrs).
As an experienced investor I think you know the answer. In my experience the answer is NO.
Iron condors, as a strategy, are easy to understand.
You can increase safety so that some trades are 'safer' than others.
But 'safe'? No. There is always risk of loss.
If the ideal you seek were truly available, every investor in the
world would be using that strategy – and the profits would be tiny
(because there are people who would be willing to make these trades for
5% per year. And that would drive prices lower and lower).
There are strategies that outperform the index. But these are not
'safe.' They are 'safer.' Covered call writing is such an example. Read
about the CBOE BuyWrite Index, BXM).
Covered calls have less risk than owning the index. But nothing is completely safe.
Collars guarantee limited losses – so from that perspective, they
are safe. But monthly income is not guaranteed. In bear markets, losses
may be small, but there will surely be no income.
Options improve your chances of earning a profit – but there are no guarantees.