A short iron condor is an income strategy that aims to profit when a stock stays within a specified range over the course of the trade. The trade is composed of four options with the same expiration: A long put far out of the moneyA short put closer to the moneyA long call far out of the moneyA short call closer to the moneyThe maximum profit is limited to the premium received while the maximum potential loss is also capped. To calculate the maximum loss, take the difference in the strike prices of the long and short options, and subtract the premium received. Traders should have a neutral out…