Reverse Iron Condor
Buy an OTM Call Debit Spread and an OTM Put Debit Spread to capture massive breakout moves with capped defined risk and lower cost than a strangle.
Interactive Payoff Curve & Greeks Simulation
Visualize the theoretical profit & loss at expiry vs T+0 immediate day curves. Drag the simulation slider to stress-test your trade.
Option Payoff Curve & Greeks
Net Option Greeks (Sensitivity Profile)
Values per 1 Lot standard unitMulti-Leg Position Structure (4 Legs)
| Action | Instrument / Strike | Type | Expiry | Approx Delta | Est. Premium | Qty Ratio |
|---|---|---|---|---|---|---|
| SELL | 23,900 PE | PUT | Monthly Expiry | -0.10 | ₹35 | 1x |
| BUY | 24,200 PE | PUT | Monthly Expiry | -0.25 | ₹110 | 1x |
| BUY | 24,800 CE | CALL | Monthly Expiry | +0.25 | ₹110 | 1x |
| SELL | 25,100 CE | CALL | Monthly Expiry | +0.10 | ₹35 | 1x |
How the Structure Works
Defined-risk long volatility structure.
A Reverse Iron Condor buys an OTM Put Spread and an OTM Call Spread. It gives you the breakout profit potential of a Long Strangle but costs significantly less because the outer short wings finance the trade and cap the maximum loss.
Institutional Strike Selection Rules
Phased Execution Blueprint
Follow this structured sequence to eliminate emotional hesitation during order entry, lifecycle management, and final exit.
Breakout Setup
Deploy when expecting sharp directional break.
Interactive Margin & Position Size Calculator
Calculate exact lot sizing based on the 1-2% risk rule to preserve capital against Black Swan events.
Options Position Size & Max Risk Calculator
Total net liquid equity in your brokerage account
Recommended: 1.0% - 2.0% for disciplined longevity
Wing width max loss or defined mental/system SL
Rigorous Risk Rules & Adjustment Protocols
Non-negotiable parameters for stop-loss triggers, portfolio caps, and firefighting adjustments when market tests your strikes.
- Close when breakout reaches outer wing.
Defined risk.
NIFTY Reverse Iron Condor Trade Walkthrough
Nifty broke resistance with high volume.
Bought 24200 PE & 24800 CE / Sold 23900 PE & 25100 CE (Debit = ₹150 = ₹3,750)
- Rallied past 25,100 to hit maximum profit.
Common Mistakes to Avoid
Why it happens: Theta decay hurts inside the range.
Solution: Cut if market stays flat.
Institutional Pro Tips
Reverse Iron Condor FAQs
How is it better than a Long Strangle?
It costs less because the outer short wings subsidize the purchase of the inner long options.
Alternative & Complementary Strategies
Sell an OTM Call Spread and an OTM Put Spread simultaneously to collect double premium in a range-bound market with strictly defined risk.
Buy an OTM Call and an OTM Put at different strikes for a lower cost than a straddle, targeting massive explosive market moves.
Buy an ATM Straddle and sell OTM wings to finance a low-cost, defined-risk breakout trade.