Iron Condor#
The “Range” Play - Profit when price stays between defined boundaries.
Overview#
| Attribute | Value |
|---|---|
| Environment | Positive Gamma (Range) |
| Market Dynamic | No Clear Magnet / Choppy |
| Volatility | Any |
| Primary Goal | Range Capture - Profit if price stays “between the posts” |
| Profit Target | 50% of Max Credit |
| Max Loss | Width of one spread minus total Credit |
Use when the market is stable but there isn’t a single “Magnet” strike to pin to. You’re betting on a range, not a specific level.
Structure#
- Sell OTM Call Spread (Call Wall or ~15-20 Delta)
- Sell OTM Put Spread (Put Wall or ~15-20 Delta)
Entry Criteria#
- Positive Gamma environment confirmed
- No clear single magnet strike
- Identifiable Call Wall and Put Wall levels
- Price is choppy/range-bound
Exit Rules#
Profit Target#
- Close at 50% of max credit
- Since you collect less premium than a Fly, squeeze more out of it
Stop Loss#
- 3x Credit Received
- Stop out if one side is tested
Management#
If one side is tested:
- Roll the untested side closer to collect more credit
- Do NOT roll the tested side
- Use the additional credit to defend delta
Never roll into a tested side. If the range is breaking, accept the loss rather than doubling down.