Iron Condor Calculator: Max Profit, Max Loss & Breakevens

Enter the four strikes and premiums of your options trade into this iron condor calculator, and it returns the net credit, both breakevens and the strategy's maximum profit and maximum loss before you send a single order. Because the position wins when the stock stays inside a range, you can see whether that range pays enough for the risk you carry, and you can do it in seconds. The formulas, a full worked example and the judgement calls behind each number follow below.

What is an iron condor and how do its four legs fit together?

An iron condor is a four-leg, defined risk strategy built from two vertical spreads that you open together in the same expiration cycle. You sell an out-of-the-money (OTM) put spread below the market and an out-of-the-money call spread above it, then keep the premium if the underlying asset finishes between the two inner strikes at expiration. The two long options at the outer strikes, called the wings, turn an uncapped short strangle into a trade with a fixed worst case.

Neither spread needs a forecast of direction, so this iron condor position is a non-directional bet: you only need the underlying asset to stay inside a range. Many traders treat it as an income strategy for quiet markets, accepting a small, capped reward in exchange for a high chance of collecting it. The two spreads also hedge each other, because the bullish put spread offsets the bearish call spread, which keeps the trade neutral at the start.

Put spread and call spread: two halves of one trade

The lower half is a put spread. You sell a put at a strike below today's stock price (the short put) and buy a put at a lower strike (the long put) for protection. The upper half is a call spread. You sell a call above the price (the short call) and buy a call at a higher strike (the long call). Each half is a credit spread, the same kind of vertical spread that many people open on its own. Joined together, they collect premium from both directions, while the underlying asset can only threaten one side at a time.

The four iron condor components in the sample trade used through the rest of this page start with a stock at $63.20 and 35 days to expiration. You sell the 58 put for $0.83, buy the 54 put for $0.31, sell the 68 call for $0.94 and buy the 72 call for $0.38. Each spread is $4 wide.

A neutral strategy for range-bound markets

Time is the reason this neutral strategy appeals to options traders. Every option you sell loses extrinsic value as expiration approaches, and the trade collects that decay from four legs at once. If the underlying asset drifts sideways, the options you sold expire worthless and you keep the whole credit. If volatility falls after you open it, you also gain, because the options you owe get cheaper to buy back.

Why traders choose an iron condor strategy

• An iron condor has a known worst case the moment you open it, so position size becomes a calculation instead of a guess.
• The margin, or buying power reduction, is usually the width of one spread minus the credit, far less than a naked option sale would tie up.
• An iron condor profits from a market that goes nowhere, exactly when a directional bet would not.
• A wide gap between the short strikes gives an iron condor a high probability of profit, although the payoff is lopsided.
• Most iron condors are opened on liquid stocks, ETFs and index options, because tight quotes keep the four legs cheap to trade.
• You can close an iron condor early, roll one side, or let it expire, depending on how the underlying moves.

How to use this options profit calculator and payoff visualizer

The calculator above works from the same quotes you see in your broker's option chain, so keep that window open while you fill in the fields. In options trading, a trader who enters the wrong strike gets a confident-looking wrong answer, and each entry in the iron condor trade has one specific job. The order below keeps mistakes out of the results.

1. Choose your expiration and note the number of days to expiration.
2. Enter the four strike prices in rising order: long put, short put, short call, long call.
3. Enter the premium for each leg per share, using the price halfway between bid and ask.
4. Set the number of contracts. Each contract controls 100 shares.
5. Read the net credit, max profit, max loss and both breakevens, then check the shape of the payoff.

Strikes, premiums and contracts to enter

List the strike prices from lowest to highest. A true iron condor uses two spread widths that match, so a $4 put spread pairs with a $4 call spread. When your two widths differ, the wider side sets your worst case, and the trade becomes an unbalanced condor. Prices come straight from the option chain: use the midpoint, and place limit orders near it rather than accepting the market price on four legs.

Results the calculator returns

• Net credit: what you collect after buying the two long options.
• Maximum profit: the net credit, times 100 shares, times your position size.
• Maximum loss: the width of one spread minus the credit, scaled the same way.
• Breakevens: the two prices where the trade neither gains nor loses at expiry.
• Risk/reward ratio: the maximum loss divided by the maximum profit.

A model-based version can add an interest rate, a risk-free rate and a dividend yield to a Black-Scholes estimate of how likely the underlying asset is to finish inside your cushions. Those extras change the probability figure only. The arithmetic for profit, loss and both price levels never depends on them.

Iron condor max profit, max loss and breakeven formulas

Four short formulas drive every figure on the page. Let \(C\) be the net credit per share, \(W\) the spread width, and \(N\) the number of iron condors you trade. Prices are quoted per share, so you multiply by 100 to convert a quote into dollars, and your iron condor profit is always the credit times that multiplier.

Net credit, net debit and net premium

Add the premium received on the two short options, then subtract the premium you pay for the two long options. The result is the net premium, quoted per share.

$$C = (P_{sp} + P_{sc}) - (P_{lp} + P_{lc})$$

When that net premium is positive it is a net credit, and the premium collected is also the most the trade can earn. A negative net premium is a net debit, which is what a long version costs to open. Every standard iron condor is opened for a net credit received, and you can split the net credit received into a put-side credit and a call-side credit to see which half contributes more. Whatever the split, the credit received belongs to you on day one, and it is also your cushion on both sides.

Upper breakeven and lower breakeven points

Each side has its own breakeven price, and the credit you collected pushes both further from the market than the inner strikes alone.

$$B_{lower} = K_{sp} - C \qquad B_{upper} = K_{sc} + C$$

Between these two breakeven points, the trade is profitable at expiration. Outside them it loses, and past the long strikes it loses the most.

Maximum profit and maximum loss per contract

$$\text{Profit}_{max} = C \times 100 \times N \qquad \text{Loss}_{max} = (W - C) \times 100 \times N$$

The top payoff happens when every leg finishes worthless, which requires the underlying asset to end between the sold strikes. The bottom one happens when one spread finishes fully in the money, and only one side can do that at a time. Because the downside is the spread width minus the credit, wider protection raises the risk even as it raises the credit.

Worked example: a four-contract iron condor

Here is the whole calculation for the trade introduced above, built from the legs and prices you would read off a live quote screen.

• Buy the 54 put at $0.31.
• Sell the 58 put at $0.83.
• Sell the 68 call at $0.94.
• Buy the 72 call at $0.38.

The premium received on the two short options is $1.77 per share, and the premium paid for the two long options is $0.69, so the net credit is \(0.83 + 0.94 - 0.31 - 0.38 = 1.08\) per share. Four iron condors collect \(1.08 \times 100 \times 4 = 432\) dollars. The wing size is \(58 - 54 = 4\), which makes your iron condor max loss \((4 - 1.08) \times 100 \times 4 = 1{,}168\) dollars. The breakevens are \(58 - 1.08 = 56.92\) and \(68 + 1.08 = 69.08\). Risking $1,168 to make $432 is a ratio of 2.70 to 1, and the credit equals 27% of the wing size.

Reading the payoff diagram at expiration

The flat top of this iron condor payoff is the profit zone, where all four options expire worthless and you keep $432. The two sloped sections are where one short leg has gone in the money and is eating into your credit, and the flat floors are where the long options cap the downside. A good payoff diagram also marks the current price, so you can see how much room the underlying asset has before it reaches a short strike.

Probability of profit for this iron condor

With volatility at 27% and 35 days left, a lognormal model gives about a 74.9% chance of finishing between $56.92 and $69.08. That probability of profit is an estimate, not a promise, and it moves with the implied volatility you enter: at 24% it rises above 80%, and at 30% it falls to about 70%. It is the reason many people accept a 2.70 to 1 risk/reward ratio, since they expect to win roughly three trades in four.

Short iron condor: the classic net credit trade

When people say iron condor without a qualifier, they mean the short iron condor described so far. You sell the closer strikes, buy the outer strikes, and receive a credit, and the premium received is also your maximum profit. The trade earns that maximum when the market stays quiet, so it is a bet on low volatility that pays you for time passing.

When a short iron condor pays off

A short iron condor works best when volatility is high enough to pay a decent credit and the underlying asset then behaves calmly. Many traders look for a credit near a third of the wing size, since that tends to give a workable balance between reward and the odds of winning. The sample trade collects 27%, a little below that mark, which is why its reward looks thin next to the risk. Moving the short strikes closer to the market lifts the credit but lowers the odds, and moving them out does the reverse. Choosing each strike price is therefore a decision about how much room you want, not just how much you want to collect.

Long iron condor payoffs

Reverse the four legs and you get the long iron condor. The trader buys the closer put and call, sells the outer ones, and pays a net debit. Now the trade profits from high volatility: it wants the underlying asset to finish outside the range, not inside it.

Long iron condor max profit and max loss

Flip the sample trade. Buying the 58 put and 68 call while selling the 54 put and 72 call costs a $1.08 debit per share, or $432 for four iron condors, and that debit is the most you can lose on this side. The most you can make is the wing size minus the debit, which comes to $1,168. The turning points match the short version at $56.92 and $69.08, because the same strikes and the same premium are involved. The long side is often used ahead of events that could move the underlying asset sharply, for example earnings, since a long iron condor pays when the move is large in either direction, and the long iron condor payoff is capped at what you paid.

Reverse iron condor: same trade, opposite side

Some traders call the long version a reverse iron condor, because its payoff mirrors the short one. It is a cheaper, capped alternative to an at-the-money long straddle, which costs more and needs a bigger move to pay off.

Sizing an iron condor for a $68,000 account: a walkthrough

Your account holds $68,000, and your rule is that no single trade may risk more than 2% of it, which is $1,360. An index ETF trades at $241.63, its option chain shows 42 days to expiration, and recent price swings have been narrow, so a range-bound trade looks reasonable.

You pull four quotes for a $6-wide setup and type them into the calculator: buy the 224 put at $0.78, sell the 230 put at $1.47, sell the 254 call at $1.62 and buy the 260 call at $0.91. You enter 3 for the number of contracts and read the results:

• Net credit: $1.40 per share, or $420 for the trade
• Maximum loss: $1,380
• Breakevens: $228.60 and $255.40

Two of those figures drive your decision. The breakevens sit 5.39% below and 5.70% above the $241.63 price, which is a wider cushion than you expected from quiet markets. The $1,380 maximum loss, though, is $20 over your $1,360 cap, so the trade fails your own rule as entered. You also notice the $1.40 credit is 23.3% of the $6 width, under the one-third guideline many premium sellers use, so widening the wings for extra credit would only add risk.

The fix is a rerun with one input changed. Setting the contracts to 2 returns a $280 credit and a $920 maximum loss, which is 1.35% of the account and inside the cap. You place the order as a single four-leg limit near the midpoint, then set a buy-to-close order for $140, half of the credit, so the trade is closed automatically once it has earned that much.

Iron condor strategy: strikes, wing width and expiration

Every result on this page depends on three choices you make before the calculator gets involved. The iron condor strategy is a trade-off between how much credit you collect, how likely you are to keep it, and how much you risk to get it. Like any options trading strategy, a 4-leg structure only works if you size it so that a full loss is survivable.

Choosing strike prices and wing width

Start with the short strikes, since they define the range you are betting on. The 58 put sits 8.2% below the $63.20 stock price and the 68 call sits 7.6% above it, so the underlying asset has to travel roughly 8% in either direction within 35 days before either short leg is threatened. Then choose the wing size: a narrow wing keeps the worst case small, while a wide one collects more credit for more risk.

• Sell an OTM put and an OTM call, so the stock starts near the middle of the range.
• Buy the protective legs the same distance out, so the two spread widths match.
• Compare the credit with the worst case before you compare it with any other iron condor.
• Skip strikes where the OTM options pay almost nothing, because a thin credit cannot cover trading costs.

Iron condor example with wider wings

This iron condor example keeps the same 58 put and 68 call and moves the outside legs to $6: buy the 52 put for $0.14 and the 74 call for $0.19. The credit rises to $1.44, so four iron condors collect $576, but the worst case grows to $1,824 and the two cushions shift to $56.56 and $69.44. The reward-to-risk balance worsens from 2.70 to 3.17, which shows why a bigger credit is not automatically a better trade.

Picking an expiration date

The expiration date decides how fast time decay works for you. Options lose most of their time value in the final weeks, so many people open a trade 30 to 45 days out, as the sample does with 35, and manage it well before the last day. A shorter expiration collects less credit and leaves less time to recover from a bad move, while a longer one ties up your capital for longer. Whatever you choose, use the same expiration for all four legs.

Implied volatility and time decay in an iron condor

In an iron condor options strategy, two forces move the value of your trade between the day you open it and expiration, and you can see both of them in the calculator's inputs.

Implied volatility and volatility contraction

Selling options when volatility is elevated means you receive richer premium, and the trade then benefits from volatility contraction as prices settle back toward normal. The reverse is a warning: opening one when volatility is already low leaves a thin credit for the same risk. Expect the value to swing when the market reprices risk around earnings or another scheduled event, and remember that quiet and turbulent stretches tend to arrive in clusters.

Time decay works for you

Time decay is the steady loss of extrinsic value as an option approaches expiration, and it is the main engine of the trade. Each day the underlying asset stays inside your range, the four options lose a little value, and the trade edges toward the full credit. Decay speeds up in the last weeks, which is also when a sudden move hurts most, so time decay and risk build together.

The Greeks in an iron condor position

The Greeks summarize how the trade responds to price, time and volatility. At entry, it is close to flat in direction, gains from time, and loses when volatility rises.

Delta and gamma

Delta is near zero at the start, because the short put and short call pull in opposite directions and hedge one another. As the underlying asset moves toward a short strike, delta grows and the trade starts to act like a directional bet. Gamma is negative, which means those delta changes accelerate as expiration nears.

Theta, vega and rho

Theta is positive: each passing day adds to your profit if nothing else changes. Vega is negative, so a jump in volatility hurts even before the underlying moves. Rho is small for short-dated trades, and most people ignore it.

Managing an iron condor: rolling, adjusting and closing early

A capped worst case does not mean you have to wait for it. An iron condor options strategy has four legs to monitor, and a written plan for each scenario keeps decisions calm.

Closing at 50% of max profit

Many people close once the spread can be bought back for about half of the credit received, which captures 50% of max profit in a fraction of the time. In the sample that is a $216 gain on four iron condors. Taking profit early frees buying power for the next trade and lifts your win rate over many trades, though it also gives up some potential reward.

Rolling the untested side

When the underlying asset pushes toward one sold strike, the untested side has usually decayed to a sliver, far out of the money. Moving it closer to the market collects more premium and improves your cushion on the threatened side. Moving both sold strikes to the same level leaves an iron fly, a tighter structure with a larger credit and a narrower winning range. Adjusting like this adds risk as well as credit, so decide in advance how many times you are willing to roll.

Early exercise and pin risk

Options on stocks and ETFs are American-style, so a short option can be exercised early, particularly when it carries a lot of intrinsic value or a dividend is close. That early assignment leaves you holding shares you did not plan to own. Pin risk is the related danger at expiry: if the price closes almost exactly on a short strike, you cannot know whether you will be assigned. Cash-settled index options avoid the delivery problem, and closing the trade before the last day avoids both.

Iron butterfly, short strangle and straddle compared

The iron condor sits in a family of range-bound trades that differ mainly in where the sold options sit and how much risk is capped. An iron butterfly places both short options at the same strike, which pays more credit but leaves a very narrow profit zone. A strangle sells the same two short options as an iron condor without buying the protective legs, so its risk is unlimited on the upside and very large on the downside.

The condor and the butterfly are two versions of the same idea, with the condor trading credit for room. The two-leg alternatives in the table pay more but carry risk you cannot size in advance, which is why so many people add protection and call the result an iron fly or a condor.

Commissions, fees and other limits of a defined risk strategy

No options trading strategy is risk-free, and a calculator shows only what the trade does at expiry. It cannot know everything your brokerage and the market will do to the result, so keep these limits in mind before you rely on any figure. The risk profile is fixed at entry, but your real outcome depends on execution.

• Commissions and fees: four legs mean four charges to open and up to four to close, which can eat a large share of a small credit.
• Bid-ask spreads: quotes at the midpoint may not fill, so your real credit can be lower than the number you entered.
• Margin: your broker sets the requirement, and it can differ from the width of one spread minus the credit.
• Gap risk: the underlying asset can jump past a long strike overnight, so the worst case is reachable, not theoretical.
• Mark-to-market: your P&L before expiry differs from the expiry figures, because time value is still in the prices.
• Risk management: keep any single iron condor to a small slice of your capital, since even limited risk investing can cost you the full width of a wing.

The futures market has its own collateral rules, so do not assume that a stock-option requirement carries over to futures options. The figures on this page are for educational purposes only and are not financial advice.

Glossary of iron condor terms

Short strike

The strike of an option you sell, closer to the market, where the credit comes from.

Wing

The strike of an option you buy for protection, further from the market, which caps the downside.

Strike price

The fixed price at which an option holder can buy or sell the underlying asset.

Premium

The price of an option, quoted per share and multiplied by 100 for each contract.

Intrinsic value

The amount an option is already worth if exercised now, as opposed to its time value.

Iron condor calculator Excel template versus online calculator

An iron condor calculator Excel file gives you the same arithmetic in a sheet you can keep offline, edit and fold into your own trading journal. A good Excel template asks for the four strikes, the four premiums and the size of the trade, checks that the strikes rise in order, and warns you when the trade comes out as a net debit. What it usually leaves out is the probability estimate, since that needs a pricing model and a volatility input.

The online version above is faster for a quick check: nothing to download and nothing to maintain. The template earns its place when you want to save a trade, change the formulas, or compare many setups side by side. Whichever route you take, an iron condor strategy needs the same discipline. Enter your own strikes and premiums from your brokerage screen, work out the worst case before the best case, and place the order only when you can accept the worst outcome on the table.