Iron Condor Calculator
Free Iron Condor multi-leg options calculator. Compute net premium, max profit, max loss, breakevens and full payoff diagram for 4-leg strategy.
Payoff at expiry
| Spot move | Spot price | P&L |
|---|---|---|
| -30% | $53,900.00 | -$3,400.00 |
| -20% | $61,600.00 | -$3,400.00 |
| -10% | $69,300.00 | +$900.00 |
| -5% | $73,150.00 | +$1,600.00 |
| +0% | $77,000.00 | +$1,600.00 |
| +5% | $80,850.00 | +$1,600.00 |
| +10% | $84,700.00 | +$1,600.00 |
| +20% | $92,400.00 | -$3,400.00 |
| +30% | $100,100.00 | -$3,400.00 |
Iron Condors profit from time decay and low volatility. Exit before assignment risk peaks (typically 21-7 days to expiry).
How to use Iron Condor Calculator
This Iron Condor Calculator prices a 4-leg, market-neutral credit strategy: sell one put and buy a further out-of-the-money put (the lower wing), then sell one call and buy a further OTM call (the upper wing). It computes the net premium received as (short put premium minus long put premium) plus (short call premium minus long call premium), multiplied by your contract count. That credit is your max profit, earned when the underlying expires anywhere between the two short strikes.
Max loss equals the wider wing width minus the net credit per contract, the figure that also defines your margin requirement, so return on capital is max profit divided by max loss. The low breakeven is the short put strike minus the credit; the high breakeven is the short call strike plus the credit. The tool also tables the payoff at nine spot moves from minus 30 to plus 30 percent and reports your downside and upside room, the profit-zone width, and the risk/reward ratio. Compare the directional cousin with our <a href="/covered-call-calculator/">covered call calculator</a>.
Input guide and assumptions
You provide ten fields: the current spot price, the short and long put strikes, the short and long call strikes, the four corresponding option premiums, and the number of contracts. Strikes must satisfy long put < short put < spot < short call < long call, otherwise the calculator returns nothing because that is not a valid condor. The three preset chips, Tight Wings, Wide Wings and High IV Crush, load realistic BTC strike ladders so you can see how wing width and premium trade off.
Premiums are entered in total dollars per contract, not per-coin, and the calculator assumes you hold to expiry with no early assignment or commissions. Wings can be asymmetric, but max loss is driven by the wider side. The output is a static payoff snapshot, not a live Greeks or theta-decay model, so iron condors profit from time decay and falling volatility while price stays boxed in. To size the position against your account before entering, check our <a href="/risk-reward-calculator/">risk/reward calculator</a>.
Understanding iron condor P&L
Iron Condor profits when the underlying stays between the short call and short put strikes at expiry. Max profit = net premium received. Max loss = wing width − net premium. The strategy expresses a 'sideways with declining IV' view, profiting from time decay (theta) and IV crush.
Critical metrics: profit zone width (between breakevens), risk:reward ratio (max loss / max profit), and capital required (usually equals max loss for credit Iron Condors). Higher premium = wider strikes near spot = more risk but more profit zone. Tight strikes (close to spot) = highest premium but smallest profit zone.
Iron condor setup scenarios
BTC trading $77K, IV 60%, 30 days to expiry. Sell 70K put / buy 65K put + sell 85K call / buy 90K call. Premium: put short $1,500 - put long $700 + call short $1,400 - call long $600 = $1,600 net credit. Max profit $1,600, max loss = 5K wing - 1.6K = $3,400. Risk:Reward 2.13:1. Profit zone: $68.4K-$86.6K (24% width).
High-IV crush play: post-FOMC, IV at 90% spikes vs realized vol of 50%. Sell same condor at higher premium $2,500. Max profit larger, but probability of being in zone slightly lower if realized vol exceeds 50%. Best when you have view that IV will revert to mean while price stays directional-flat.
Risk and execution checklist
- Before opening: 1) Verify all 4 legs filled simultaneously (use combo order, not 4 separate). 2) Net credit received matches expectation. 3) Underlying within profit zone at entry (not already near a breakeven). 4) No earnings/major events in expiry window. 5) Plan exit triggers (profit %, stop loss, time-based).
- Strike selection: use 1 standard deviation move based on IV (= price × IV × sqrt(days/365)). Sell short strikes outside 1 SD (~16% probability of touch each side). Wing width usually 5-10% of spot, narrower wings reduce capital but ITM at expiry hurts more.
Iron condor mistakes to avoid
- Holding to expiry hoping for max profit. Theta accelerates last 2 weeks but tail risk also accelerates. Better to close at 50% of max profit (e.g., $800 of $1,600 max) typically achieved in 14-21 days, freeing capital for next trade.
- Not adjusting when underlying breaches a short strike. If BTC moves to $85K (your short call), the trade is ITM on call side. Options: (a) close entire condor for loss/breakeven, (b) roll up the put side to collect more credit (defensive), (c) accept potential assignment if comfortable.
Typical iron condor metrics
Typical Iron Condor metrics for BTC 30-day: net premium 15-30% of max loss, max loss 70-85% of wing width, breakeven width 25-40% of spot. Win rate (profit at expiry) ~70-75% if managed at 50% target, drops to 60-65% if held to expiry.
Annualized return with weekly Iron Condors: 25-50% on capital allocated, before assignment-driven losses. Real-world returns 15-30% accounting for losers. Higher returns possible with leverage but unsustainable risk.
Execution templates you can reuse
Weekly opening routine: each Monday, evaluate IV vs realized vol. If IV/RV ratio > 1.3, condor is favorable. Open with limit order at midpoint of net credit. Set good-til-cancel orders to close at 50% profit and 200% loss.
Adjustment criteria: if delta of either short strike exceeds 0.30 (probability ITM > 30%), consider adjustment. Roll the threatened side up/out for additional credit, or close losing side and let the other expire worthless. Avoid doubling down on a directional bet.
Data hygiene and model maintenance
Maintain options trade log: open date, all 4 legs (strike, premium), net credit, max profit/loss, days to expiry, close date, close price, P&L. After 30+ condors, you'll see your realized win rate and adjust strike selection accordingly.
Avoid weekly options on illiquid underlyings (some altcoin options have 5-15% bid-ask spread that erodes edge). Stick to BTC and ETH options on Deribit, OKX, Binance, sufficient liquidity for typical retail size.
Final validation before capital deployment
Sanity check: short put strike 70K, long put 65K → put wing = 5K. Short call 85K, long call 90K → call wing = 5K. Net premium received $1,600. Max loss = max(5000) - 1600 = $3,400. Max profit = $1,600. R:R = 3400/1600 = 2.13:1. Breakevens: 70000 - 1600 = $68.4K (low), 85000 + 1600 = $86.6K (high). All match calculator output.
Post-expiry: if BTC closed in profit zone, you keep full premium. If outside one short strike: loss = (closing_price - short_strike) - net_premium (approximately, before considering long wing protection). Verify P&L matches statement.
Authoritative sources
Frequently asked questions
What is an iron condor strategy?
An iron condor is a 4-leg options strategy: sell an out-of-the-money put + buy a further OTM put + sell an OTM call + buy a further OTM call, all at the same expiry. You collect net premium and profit if the underlying stays between the short strikes at expiry. Max loss = wing width minus net premium.
When should I use an iron condor?
Iron condors profit from low realized volatility and time decay (theta). Use them when you expect the underlying to trade sideways and implied volatility is elevated (IV/realized vol ratio > 1.3). Post-news events (FOMC, ETF announcements) often spike IV — selling condors after IV peaks but before underlying moves can capture the volatility crush.
What is the risk-reward ratio of an iron condor?
Typical iron condor R:R is 2:1 to 4:1 (risk $2-4 per $1 of premium). Example: 5K wing width, $1,500 premium → max loss $3,500, R:R 2.33:1. The probability of profit at expiry is 60-75% if managed at 50% target, providing positive expected value when premium pricing > theoretical fair value (IV > realized vol).
When should I close or adjust an iron condor?
Close at 50% of max profit (typical 14-21 days for monthly condors). Adjust when delta of either short strike exceeds 0.30 — options: (1) close losing side and let the other expire, (2) roll the threatened side further OTM, (3) close entire position to limit losses. Avoid holding to expiry as gamma risk explodes.
Can I lose more than my initial credit on an iron condor?
Yes. Max loss = wing width minus net premium received. A $5K wing with $1,500 credit caps loss at $3,500 per contract. This is far more than the $1,500 premium collected. Position-size accordingly — never deploy more than 5-10% of capital per condor, and account for the wider loss in your risk budget.
What is the best expiry for an iron condor?
Most retail traders use 30-45 days to expiry (DTE) at entry. This sweet spot balances theta acceleration (faster as expiry nears) against gamma risk (extreme near expiry). Weekly condors offer faster theta but require constant monitoring. Quarterly condors offer smoother P&L but lower annualized returns.
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