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Selling iron condors and selling strangles are two very common options trading strategies, as they are both directionally-neutral trades.
However, short iron condors have less risk than short strangles, as the options that are purchased limit the risk of the strangle. At the same time, purchasing options against the short options reduces the option premium that is received, which reduces the maximum profit potential.
How do iron condors compare to strangles in terms of average profits and losses in the S&P 500 over the past ten years?
Furthermore, how have these trades historically performed when entered in high VIX environments and low VIX environments? The results may surprise you.
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