 What's up everyone? Welcome to another video lesson from navigationtrading.com. Just wanted to share with you an adjustment trade that we are making in SPY. So we originally had on an iron condor in SPY and part of our adjustment process is if price comes through one of the breakevens, we are going to close out the unbreached side. So we closed out the put vertical side several weeks ago and as you can see, price continued to just rip higher to a point where we are way out of range. And because this is a defined risk strategy, we are gonna give it some time. In fact, in this case, today is April 16th and these options expire in just two days. So typically they would expire on Friday or Friday would be the last day to trade those, but in this case, Friday is a holiday. So it's actually Thursday is the last day to trade and today is Tuesday. So we're in expiration week. We've got to get to a point of doing something. We either need to close this and just take the loss or the other option would be to roll it to extend duration on the trade. Now, when determining which one you're going to do, it really comes down to your overall assumption of the market and what's going on in the rest of your portfolio. So for example, we like to keep short delta. We like to keep a short bias in our portfolio to protect from those really quick, violent downside moves in the market. And so this is one that we're going to choose to keep on to keep some of that short delta. So in that case, we're gonna look to roll. If that wasn't the case for you, if you didn't want that short exposure or you had an assumption that the S&P was going to continue higher, then you might want to just cut this loose and take your loss. You know, the other piece of this, I mean, this market's been on an incredible run since the beginning of 2019 and it's just continued to rip higher with very little pullbacks. And so I'm also anticipating a potential pullback. And you know, this is not any, there's no scientific or statistical data to back this up of why I'm thinking this. It's just simply from a contrarian standpoint, this thing has just been on fire to the upside. At some point it's gonna pull back and I'm good with taking that risk of extending duration on this trade and continuing to look for a little bit of downside in the overall market. So what we're gonna do is we're gonna go ahead and roll this. We're currently in the April monthly cycle. We're gonna roll this out to May. So what I'd like to do, kind of give you a quick snapshot of my thought process of how we do this. So the first thing I'm gonna do is I'm gonna go to the May trade tab, to the cycle that I'm rolling out to. And I'm gonna go ahead and set this up in the analyze tab because I'm a visual trader, so I can look at it. And so I'm just gonna start with something a little bit out of the money. So let's look at the 292. So we're just gonna do sell vertical as if we were just repositioning this vertical spread in the next month. As you can see, our current position is three strikes wide. So we wanna keep the same width. So I'm gonna do the 292, 295. That would keep that at three strikes wide. And then I'm just gonna take this over to the analyze tab. Okay, so I'm gonna click off my current position. I'm gonna make sure the contracts are the same here. I had five contracts there. And so we're just looking at the theoretical position. Now what I like to do when I roll a trade like this is you also wanna make sure that your calendar for expiration is the same as your calendar up here. And so what I want to do is I wanna take a look at this and see, okay, what's my potential probability of success? Now, right now it's showing about a, excuse me, that's on price. So you wanna set your price slice to the breakeven point, and that's better. So what I'm looking at is about a 60% probability of success. So when I roll these trades or when I set up a vertical, forget about rolling, if I'm just setting up a vertical spread, I like to have about a 60% or better probability of success on the trade. So I've got about a 60% chance that I'm gonna profit on this. You can see we've got a max profit of $710 and then a max loss of $790. Okay, so the probabilities are on our side and it's really a bearish position. But remember, we're rolling the exact same position from April, just extending duration out to May. We're adjusting our strikes to accommodate that and so that's what we're looking at doing. So then what I do is I simply click on the position, hit shift, highlight the entire thing, then you can do create rolling order and it's gonna be the top one, sell vertical roll. Now what I can do is I'll push this up so I can see what I've got here. So what I need to do is it defaults to the very next weekly cycle. So I wanna make sure this matches up with the trade that I just analyzed. So I'm gonna bring this down to the May 17th expiration and then I wanna make sure that I have the correct strikes as well. So I'd analyze this first so I can get the visual representation and then I also pull it up so I don't make a mistake when I'm correcting my expiration cycle and my strikes. So here I'm selling the 292. So I wanna change this to 292 and the one I'm buying is the 295. So I wanna change that to 295. So now essentially what we're doing is we're closing out the current position of the 284-287 strike and we're repositioning that at the 292-295 strike. Now another question I get sometimes is we're doing this trade for a debit, not a credit and we always like to roll for a credit. I mean that is the best of the best, right? We're actually collecting a credit for making the roll. In this case, because the price was so far in the money on our current trade, when we roll out and adjust the strikes, we're gonna be paying a debit for the roll. And if it was a case where we didn't have a bearish assumption on the market and if it was a case where we didn't wanna keep that short delta in our overall portfolio, then we would just close the trade out, okay? But in this case, we wanna keep it on. We still have that bearish assumption. We still need the short delta in our portfolio. And so therefore I am willing to pay a debit for this trade because if I did just close it out, I'd be going to look for another bearish trade anyway. So why not just keep this extend duration and look for some of that cyclicality in this specific market, all right? So I have adjusted that. We're probably gonna get filled, not right at the mid-price, somewhere in between mid and natural. So I just adjusted that and I'm gonna hit confirm and send and see if we get filled and we sure did. We got filled at actually a little bit better than what we priced it at. So the roll has taken place. And so now if I just exit out of the theoretical position, this is our actual current position, exact same thing we looked at before the trade, a little over 60% probability of success. And we have rolled that position to extend duration. So that's it. Hope that was helpful. If you have any other questions, feel free to go to navigationtrading.com and follow along on what we're doing. Take care, everybody.