Six Things to Know About Your Iron Condors

The probability paradox states that the actual likelihood of success on iron butterflies, and for most short premium contracts, is much higher than the initial probabilities suggest. Even low levels of implied volatility is generally overstated when it actually plays out through the expiration month. So whenever possible, try to go a little bit wider. Try to sell less contracts, but wider positions. Less contracts is a lot easier to manage. Cheaper on commissions, depending onwho your broker is,. And also means less of a headache if one side of your iron butterfly gets assigned or exercised early.