A Short Call Condor consists of the following options:
Similar to a short butterfly strategy, a Short Call Condor varies by having two middle bought options with different strikes. This strategy is suitable for a volatile market.
The Short Call Condor entails selling 1 ITM Call (lower strike), buying 1 ITM Call (lower middle), buying 1 OTM Call (higher middle), and selling 1 OTM Call (higher strike). The resulting position becomes profitable if the stock or index experiences very high volatility, resulting in a significant move. Maximum profits occur if the stock or index finishes on either side of the upper or lower strike prices at expiration.
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