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How Wide Should Iron Condors Be?

Market Measures

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As you widen the wings of an iron condor, buying power increases exponentially while credit plateaus.

The inflection point (in SPY) where we want to trade is around the $20-wide long wings because that brings us closest to ⅓ the width of the iron condor.

For other underlyings in general, when the credit reaches ⅓ the width of the iron condor, that is a signal that credit is beginning to reach its maximum while risk keeps increasing.

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