What is a Long Iron Condor?
A Long Iron Condor is a non-directional options strategy used when you expect low volatility and believe that the market will stay within a certain range. It combines two credit spreads—a bull put spread and a bear call spread—to form a four-leg strategy with limited risk and defined reward.
You earn when the market remains quiet and trades within your selected zone.
Benefits of a Long Iron Condor
- Earns a net credit
- Limited and defined maximum loss
- Ideal for range-bound markets
- High Probability of Profit (POP) when IV is stable
When Should You Use It?
Use a Long Iron Condor when:
- The stock/index is trading sideways
- There’s no major event/news expected soon
- Implied Volatility is moderate or slightly elevated
- You prefer neutral strategies with capped risk
Entry & Exit Strategy
Enter when:
- IV is moderate or high (to collect better premiums)
- Price is trading around a strong support and resistance range
- There is no clear breakout or breakdown signal
Exit when:
- Price nears either the lower or upper breakeven
- You’ve achieved 60–70% of your max profit
- Volatility drops sharply in your favor
Use OptionX’s live P&L view to time your exits precisely.
Example: Long Iron Condor with NIFTY (Jun 05, 2025 Expiry)
Let’s look at how to structure a Long Iron Condor using NIFTY options on OptionX.
Strategy Setup
Here’s what you’re doing:
- Sell 24,550 PE at ₹105.95
- Buy 24,350 PE at ₹55.50
- Sell 24,950 CE at ₹140.40
- Buy 25,150 CE at ₹78.00
This results in a net debit (premium paid) of ₹112.85, while the gross credit from the sales is ₹133.50.
You’re betting that NIFTY stays between 24,550 and 24,950 by expiry — giving you a sweet zone for profit.
Why These Strikes?
The chosen strike prices create a balanced structure:
- The puts (24,550 and 24,350) form a bull put spread
- The calls (24,950 and 25,150) form a bear call spread
Together, they create an iron condor centered around the current market level. The IVs across strikes (between 15.99 and 16.53) are fairly stable — ideal for this strategy.
Key Metrics of This Strategy
Your maximum profit is ₹6,547.50 — realized if NIFTY expires between 24,550 and 24,950.
Your maximum loss is limited to ₹8,452.50 — this happens if the market breaks out or falls significantly beyond the wings.
Your breakeven range is between approximately 24,437.3 and 25,062.7.
Risk-to-Reward Ratio is 1.29 — for every ₹1 of risk, you can earn ₹0.78.
Funds required are ₹82,951.72 — includes margin and net premium.
POP (Probability of Profit) is 62% — high odds if the market consolidates.
How to Execute This on OptionX
Step 1: Go to OptionX, Sign in and Open the Strategy Builder
Login to OptionX → Click Strategy Builder
Step 2: Select Long Iron Condor from pre-built strategy and Save it.
Step 3: Open Ladder
Step 4: Place the order
Click on bid and offer column to Sell and Buy strategies
Enter quantity and order type, then place your multi-leg order
