TradingView strategy guides / Iron condor strategy
Four legs, two wing widths
A short iron condor combines a bull put spread with a bear call spread on one underlying and expiration. Its short put strike is below its short call strike. A shared short strike instead creates an iron butterfly. The interval between the two short strikes is the maximum-profit region at expiration.
The hypothetical example below uses one contract per leg, a 100-share multiplier, a $100 underlying and a $0.65 fee budget per leg. The put wing is $5 wide; the call wing is $10 wide. Click "Load unequal-wing example" above to reproduce it.
| Leg | Strike | Premium | Cash flow |
|---|---|---|---|
| Buy put | $90 | $0.40 | -$40 |
| Sell put | $95 | $1.30 | +$130 |
| Sell call | $105 | $1.50 | +$150 |
| Buy call | $115 | $0.20 | -$20 |
Gross credit = 1.30 + 1.50 - 0.40 - 0.20 = $2.20/share, or $220. Fees = 4 × $0.65 = $2.60. Effective credit C = $2.174/share; maximum expiration profit = $217.40. Lower breakeven = 95 - 2.174 = $92.826; upper breakeven = 105 + 2.174 = $107.174. Displayed prices round to cents; calculations retain precision.
Put-side expiration loss = (5 - 2.174) × 100 = $282.60 at or below $90. Call-side loss = (10 - 2.174) × 100 = $782.60 at or above $115. The wider call wing determines maximum loss, so the two outer tails are not equally risky.
P/L(S) = 100 × contracts × [C + max(90 - S, 0) - max(95 - S, 0) - max(S - 105, 0) + max(S - 115, 0)]
At S = $93, the long put is worth $0, the short put costs $2, and both calls expire worthless. P/L = (2.174 - 2) × 100 = $17.40. At $100 it is $217.40; at $110 it is -$282.60. These are expiration cash flows, not a historical backtest.
Why IV changes the exit before expiration
Hold the same entry premiums and $100 underlying fixed. Start with 30 calendar days to expiry, then set days elapsed to 15, risk-free rate to 0% and common IV to 25%. The example applies that IV to all four European-style option valuations and assumes no dividends. Scenario P/L = $217.40 minus the modeled closing debit.
| Relative IV change | Scenario IV | Closing debit | P/L after fees |
|---|---|---|---|
| -20% | 20% | $41.91 | $175.49 |
| 0% | 25% | $82.86 | $134.54 |
| 20% | 30% | $128.40 | $89.00 |
Time and volatility affect the debit to close, even when the underlying does not move. At expiration, all three IV scenarios converge to the same intrinsic-value payoff. This model uses one flat IV; actual legs can have different IVs, spreads, liquidity and exercise behavior.
Inputs that invalidate the usual two-breakeven picture
- Use one expiration and equal quantities, with long put < short put < short call < long call. Mixed expiries require a different valuation and settlement analysis.
- A net debit, or fees that consume the credit, removes the positive maximum-profit region. This calculator stops instead of displaying credit-condor breakevens.
- If the credit reaches the narrower wing width, that side may have no outer loss region. The familiar two-breakeven formula is then invalid. This tool rejects that input; it is not proof that every asymmetric structure with such a credit is impossible.
- Daily closes may come from different trading times. Verify all four bid/ask quotes, expiry, deliverable and fees together. American-style assignment can leave stock exposure; expiration payoff limits do not model that path, slippage or financing.
Rebuild the structure in TradingView Options
In TradingView Options, start with Iron Condor or create a strategy, add the four buy/sell positions, and check each strike, expiry, size and entry price. Compare the expiry payoff with a what-if scenario that changes time and IV. TradingView supports custom multi-leg structures; this page deliberately restricts the inputs to one standard credit-condor shape.
Use Pineify AI Stocks & Options Picker to inspect available options-chain inputs. In Trading Journal, keep a plan or note with the four premiums, quote time, fee budget, expected range and exit condition. This is a manual research record, not an automatic four-leg historical backtest or an execution guarantee.
Educational model, not investment advice. A model probability is conditional on its distribution and IV assumptions; it is not a measured win rate or a promise of profit.
References: OIC short iron condor, TradingView Options strategy builder, and TradingView what-if scenarios.