Initially I had a short straddle in the Nifty at 17600 intending it to be an intraday trader. When the Nifty dropped to 17500 I added another straddle. Thereafter, I decided to buy the legs and carry it overnight as an Iron Fly.
(https://zerodha.trade/zerodha-uploads/IronFly_in_the_Nifty.jpg)
The Iron Fly is nicely placed in the center. The BEPs are far off. After the FOMC meeting, the IVs will cool down which should lead to decent profits.
(https://zerodha.trade/zerodha-uploads/Nifty_Iron_Fly_190922.jpg)
My Iron Fly is in trouble because the Nifty gapped up and breached the upper BEP. To salvage the situation, I sold a naked straddle of 20 lots (which is half quantity) which has raised the upper BEP to 17925. My other option is to square off the trade and initiate a fresh one.
(https://zerodha.trade/zerodha-uploads/Nifty_Iron_Fly_200922.jpg)
This Iron Fly would have yielded a handsome profit of Rs 3.45 Lakh if i would have left it alone. However, i did not leave it alone. Instead, I exited yesterday at a loss of Rs 50000 because i was apprehensive that the FOMC would create unbearable volatility. I created a simpler Iron Fly with the center at 17700. This yielded a gain of about Rs 1 Lakh.
(https://zerodha.trade/zerodha-uploads/Nifty_Iron_Fly_220922.jpg)