---
name: skill-iron-condor
description: Defined-risk range: a bear call spread and a bull put spread, same expiry. Use for wing width, credit, and what happens if a short strike is tested.
skill_family: options-strategy
last_updated: 2026-09-30
---

# Iron condor

## When to use

- The thesis is that price stays inside a range through one expiry.
- Risk must be defined on both sides.

## Setup

- Same expiry: sell a call spread above spot and sell a put spread below spot.
- Net credit. Max loss is the wider wing width minus the credit.
- State both short strikes, both wings, credit, max loss, and the two breakevens.

## Rules of thumb

- Keep the short strikes outside the move you are illustrating.
- Name known events in the window (earnings, scheduled announcements) before the credit.
- If one short strike is tested, the adjustment is close, roll, or accept the defined loss. Pick one and say when.

## Pitfalls

- Wings so narrow that the credit is most of the width and the loss is small only on paper.
- One side much wider, so the condor is a directional bet with a spare wing.
- Holding unchanged through an event that can gap past a wing.

## Disclaimer

Options involve risks and are not suitable for everyone. Read *Characteristics and Risks of Standardized Options* at OptionsEducation.org, or from your broker or the Options Clearing Corporation, before using this structure. Examples omit commissions, fees, margin, interest, and taxes. This is a structured playbook for education. It is not a signal, a recommendation, a solicitation, or a broker order.