Iron Condor Explained: A Real Priced Example

By VantureCap · Published August 3, 2026 · 9 min read

Learning path · Lesson 26 of 290 of 29 complete

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An iron condor is a bull put credit spread and a bear call credit spread sold at the same time on the same expiration: four legs, two short strikes bracketing the market, both credits collected up front. The trainer’s deal screen invites exactly this — “Combine legs freely — e.g. a put-credit + call-credit condor” — and this lesson prices one from the real dealt cards of a single stressed SPX week.

$1,905credit collected, both wings$712.50 puts + $1,192.50 calls
$1,595maximum lossone wing’s width − the whole credit
6650–6755full-credit zone at settlement105 SPX points wide
−$4,108.85the trending week’s condor, belowone wing run over

Credits add; risks don’t

The combination works because settlement can only land in one place. If SPX finishes low enough to hurt the put wing, the call wing expires worthless and keeps its credit — and vice versa. So the two credits stack into max profit, while max loss stays a single wing’s width minus the whole credit:

condor max profit = put credit + call credit
condor max loss = widest wing’s width × $100 − total credit

Credits add; risks don't

one wing's widthmax profit: both creditsmax loss: width − credit

The condor's edge case in one picture: both credits count toward max profit, but settlement can only be on one side of the market, so max loss is a single wing's width minus the whole $1,905 — here $1,595, less than the credit itself. Stressed premium paid for the risk. Symmetric only because both wings are 35 points; with unequal widths the wider wing sets the risk.

That risk-better-than-reward ratio is not typical — it is what a stressed regime pays. VIX sat at 27.3 when these cards were dealt, and rich premium on both sides is the compensation for a tape that was moving ±115 points a day. The implied-volatility lesson is the long version of that sentence.

A real stressed-chop week

Here is the entry as dealt: SPX at 6,721, three days to expiration, choppy tape, stressed volatility. The condor sells the 6650 put and the 6755 call, each protected 35 points further out:

Wing	Legs	Credit	Own breakeven	Own max loss
Bull put credit	short 6650 / long 6615	+$712.50	6,642.9	$2,787.50
Bear call credit	short 6755 / long 6790	+$1,192.50	6,766.9	$2,307.50
Iron condor	all four	+$1,905.00	6,631 / 6,774	$1,595.00

Note what combining did to the breakevens: each wing alone breaks even at its short strike minus (or plus) its own credit, but the condor’s breakevens use the whole $19.05 of credit — the losing side gets to spend the winning side’s premium. That pushes each line deeper than the wing’s own: 6,642.9 → 6,631 on the downside, 6,766.9 → 6,774 up. (The trade-off: unlike a single spread, the condor can also lose in both directions — each wing gave up its safe side.)

TREND CHOP 5d −0.3% VIX 27.3 REGIME STRESSED EXP MOVE ±115 pts EXP 3 DTE

SPX · last 50 sessions · dates masked · entry 6,721.36

The condor sells both sides. Which single spread would you rather sell here?

Commit to a read before revealing. Your selection also plots that structure's short strike, long strike, and breakeven.

No prediction selected yet.

Reveal the held sessions

Open the reveal to play the hold period candle by candle.

Reveal: the sessions after entry

SPX chopped, dipped hard, and settled at 6,699.38 — down 0.33%, almost dead-center in the full-credit zone. Both wings expired worthless and the condor kept +$1,902.40 of its $1,905. But look at the path before you file this as easy money:

One condor, every settlement

full creditpartial creditlosingmax loss

The dip mattered while it was happening — 6,624 is through the short put and past the condor's own 6,631 breakeven — and it decided nothing: settlement, not the path, pays this structure. Expiration-line arithmetic, before fees. At 0–1 DTE the same dip can BE the settlement — the zone map is kinder at 3 DTE than at zero.

The dip was real. The intraday low of 6,623.92 traded through the 6,650 short put and through the condor’s own 6,631 breakeven — on the expiration line that price is −$703. At 3 DTE the position had time to be wrong and recover; on expiration day the same dip could have landed at settlement time, with nothing left to recover in. The 0DTE lesson is about exactly that difference, and managing open spreads covers what a live quote does while a short strike is being tested.

The wing that pays most sits in the tape’s path

Now the week that punishes the same structure. A different real entry: SPX at 6,797 in an uptrend (+2.0% over five sessions), CPI landing that morning, and the dealt call spread short the 6800 strike — barely 3 points above the market — paying a fat $1,766.25 of the condor’s $1,893.75 total credit. The premium was not a gift: it was the market pricing a continued move straight through that strike.

The week the tape trended

surviving wingbreached wing / net

Selling both sides is not neutrality: the up-tape ran straight through the call wing, and the put wing's $126 was a rounding error against −$4,235. Real quotes from the second scenario below, 1 contract, commission included.

The tape rose 1.15% and settled at 6,875, past the 6,860 long call: full max loss on the call wing, −$4,235.05, against the put wing’s +$126.20. Selling both sides looks “neutral,” but a condor is only neutral when the context read genuinely is: against a trending tape it is a bet against the trend with the bigger credit — and the bigger credit was on the trend’s side of the board for a reason.

Condor, single spread, or stand aside?

Chop plus rich premium on both sides is the condor’s home field: two credits, one possible loser, breakevens wider than either spread alone.
A trending tape wants one spread — sold on the side the trend is leaving behind — or no trade. Adding the second wing there collects a small extra credit and parks it directly in harm’s way.
Event mornings (the second week above had CPI at the bell) inflate both credits for the same reason they can blow through a strike — the event-premium lesson prices that trade-off.

Knowledge check: $1,905 of credit, both wings 35 points wide — what is the max loss, and can both wings lose?

Max loss = one wing’s width minus the whole credit: $3,500 − $1,905 = $1,595. Both wings cannot lose at settlement — SPX finishes at one price, and it cannot be below 6,650 and above 6,755 at once. (Both can be tested along the way, as the dip above shows — and at 0DTE, tested and settled can be the same thing.)

The risk, stated plainly: a condor multiplies your credit, not your safety. The stressed week above risked $1,595 to make $1,905; the trending week collected $1,893.75 and handed back $4,108.85. The difference was not the structure — it was the tape it was sold against.

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Keep learning

Practise this on real history: the trainer deals these structures on seventeen decks, and every one has a page showing how they actually settled — SPX, SPY, TSLA and GLD among them. The same structure behaves differently on an index than on a single stock, which is easier to see side by side than to be told. Compare the decks.

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Playbook Trainer is an educational game built on historical market data. Nothing on this page is investment advice or a recommendation to trade. Options involve substantial risk; defined-risk spreads can lose their full maximum loss. Scenario dates are masked, and prices reflect historical option quotes with simplified fills.