Iron Condor Calculator
This iron condor calculator estimates the financial outcomes of a short iron condor constructed from one put vertical and one call vertical. It reports net credit, maximum profit, maximum loss, breakeven points, credit-to-risk ratio, and an approximate probability of finishing between breakevens at expiry.
Values are reported both per share and aggregated across contracts (using the contract multiplier). Commission inputs are included and deducted from the gross credit to improve practical accuracy.
Calculates outcomes for a single iron condor constructed as one short put/long put vertical and one short call/long call vertical. Handles per-share and aggregate (contracts × multiplier) values, commissions, and an implied-probability estimate using a lognormal/normal approximation.
Inputs
Results
Net credit (total)
$152.40
Maximum profit
$152.40
Maximum loss
$347.60
Put breakeven
93.476
Call breakeven
106.524
Estimated probability of profit (%)
—
Credit-to-risk ratio
0.4384
| Output | Value | Unit |
|---|---|---|
| Net credit (total) | $152.40 | USD |
| Maximum profit | $152.40 | USD |
| Maximum loss | $347.60 | USD |
| Put breakeven | 93.476 | USD |
| Call breakeven | 106.524 | USD |
| Estimated probability of profit (%) | — | % |
| Credit-to-risk ratio | 0.4384 | — |
Visualization
Methodology
Monetary calculations follow standard options arithmetic: net credit equals premiums collected from short legs minus premiums paid for long wings, adjusted for commissions. Maximum loss is computed as the dominant spread width multiplied by contracts and multiplier, less the net credit (net of commissions).
Probability-of-profit is a statistical approximation: strikes are converted to standardized distances (Z-scores) using the supplied implied volatility and time-to-expiry (trading days / 252). The normal cumulative distribution function is used to approximate the chance the underlying finishes between short strikes. This is an approximation and not a substitute for full risk models or broker margin calculations.
Security, accuracy, and data integrity recommendations follow relevant standards: NIST guidance for secure handling of market data, ISO risk management principles for clear disclosures, IEEE best practices for numerical computations and floating-point handling, and workplace safety guidance for operational controls where applicable. This tool includes accuracy caveats and encourages calibration against market data from your broker.
Worked examples
Example: Underlying at $100, short put 95/long put 90 and short call 105/long call 110 with net premiums producing $0.55 net credit per share, multiplier 100, 1 contract: net credit = $55, max loss = (5 × 100) − 55 = $445.
If expiry is 30 days and implied volatility 20%, the approximate probability of finishing between breakevens is computed via the standard normal CDFs of the Z-scores for the short strikes. This gives a quick view of trade odds but not a complete risk report.
Key takeaways
Use the calculator to estimate outcomes, compare different widths or credit levels, and test sensitivity to implied volatility and expiry.
This tool provides approximations useful for planning and risk awareness. Confirm margin and actual realized P&L with your broker.
Further resources
Expert Q&A
Is the probability-of-profit exact?
No. The probability estimate is an approximation based on the normal distribution and supplied implied volatility. It assumes lognormal price behavior and does not account for discrete jumps, skew, kurtosis, or early assignment risk for American options.
Does this calculator account for early assignment, margin or liquidity?
No. Early assignment, margin requirements, liquidity impacts, and execution slippage are not modeled. Use the outputs for planning; consult your broker for margin and trade execution details.
How should I treat commissions and fees?
Enter per-leg commissions to have them deducted from gross credit. For exchange or regulatory fees not modeled here, add them to the commission input or adjust results manually.
How accurate are the numeric computations?
Numeric computations follow standard floating-point arithmetic conventions. For mission-critical decisions, cross-check with broker tools. The implementation should follow IEEE floating-point practices and validation per IEEE/ISO numeric guidelines.
Sources & citations
- NIST - Guide to Protecting the Confidentiality of Personally Identifiable Information — https://www.nist.gov
- ISO 31000 - Risk management — Principles and guidelines — https://www.iso.org/iso-31000-risk-management.html
- IEEE Standards Association - Numerical accuracy & floating point — https://standards.ieee.org
- U.S. Occupational Safety and Health Administration (OSHA) — https://www.osha.gov
- SEC - Options Markets Overview — https://www.sec.gov