Closed Trade – RIMM iron condor

Trade Analysis: Our one day trade in RIMM, which we put on shortly before RIMM announced earnings, expired as expected and yielded the full 9.87% return. Our thinking on this trade was that RIMM was unlikely to close up or down more than 12% from it's level at about $46.50 when we put the trade on. Because RIMM had moved fairly significantly after the last few earnings announcements, we saw this an a great opportunity to take advantage of the volatility in RIMM options, even those more than 12% from the market price at the time and with just one day left to expiration.

Here's our actual trade from last Thursday, Sep 16th:
Buy 4 RIMM SEP10 37.5 PUT $0.09 ($36.00)
Sell -4 RIMM SEP10 40 PUT $0.20 $80.00
Sell -4 RIMM SEP10 52.5 CALL $0.29 $116.00
Buy 4 RIMM SEP10 55 CALL $0.13 ($52.00)

Cost/Proceeds: $108.00 (net credit)
Option Requirement: $1,000.00
Total Requirements: $892.00
Commission: $20.00
Net Proceeds: $88.00
Return after Commissions: 9.87%

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