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LONG PUT CONDOR

NeutralDefined riskAdvanced

Overview

The put equivalent of a call condor. Buy the highest-strike put, sell the second-highest, sell the second-lowest, and buy the lowest — all same expiration. Identical payoff to a call condor but built with puts. Profits when the stock finishes between the two middle strikes.

What it does

Identical payoff to a long call condor but built with puts. You buy the highest-strike put, sell the two middle puts, and buy the lowest-strike put. The trade profits when the stock stays between the two short (middle) strikes at expiration. The choice between a call or put condor often comes down to pricing differences in the market.

Structure

buy 1 put + sell 1 put + sell 1 put + buy 1 put

Setup

  1. 1.Buy 1 Put at the highest strike.
  2. 2.Sell 1 Put at the second-highest strike.
  3. 3.Sell 1 Put at the second-lowest strike.
  4. 4.Buy 1 Put at the lowest strike. Same expiration.

Max profit

(Width Between Adjacent Strikes − Net Debit) × 100. Achieved when the stock closes between the two middle strikes.

Max loss

Net Debit Paid. The most you can lose is the entry cost.

Breakeven

Lower inner strike + Net Debit (lower) and Upper inner strike − Net Debit (upper).

When to use

When you expect range-bound price action within the two middle strikes.

When to avoid

In trending markets or ahead of major catalysts that could push the stock outside the condor body.

Example trade

Stock: SPY at $430
Buy 1 $450 Put / Sell 1 $440 Put / Sell 1 $430 Put / Buy 1 $420 Put
Net Debit: ~$0.50 ($50)
Expiration: 30 days

Max Profit: ($10 - $0.50) × 100 = $950 (if SPY stays between $430-$440)
Max Loss: $50 (if SPY is below $420 or above $450)

Common mistakes

  • ×Not comparing call vs. put condor pricing — sometimes one is cheaper due to volatility skew.
  • ×Entering when the spread between the two short puts is too small to generate meaningful profit.
  • ×Confusing which strikes are the 'body' (short) vs. the 'wings' (long).
  • ×Over-paying due to wide bid-ask spreads on 4-legged put structures.
  • ×Expecting a butterfly-like sharp peak — the condor has a flat 'body' where max profit persists.

FAQ

Is there any advantage to using puts vs. calls for a condor?

Sometimes put skew makes one version cheaper. Always compare the all-in debit of both versions before entering.

Can I lose more than the debit on a put condor?

No — the wings always protect you. Maximum loss equals the debit paid.

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