What do we understand by Short Iron Fly Option Strategy. It basically means selling Option and making money through its Premium. So, if the underlying let us take Nifty is in the particular range, option seller will make the profit and if any loss is there will also be very less. If we compare the Risk and Reward, so basically here Risk is of Rs 1 while Reward of Rs 3 i.e. 1: 3
Example: Here we are taking Weekly Expiry of Nifty of 22nd June 2023 where Nifty is at 18826. Here we are selling one lot of Nifty CE at the Strike Price of 18850 and also selling one lot of Nifty PE at the Strike Price of 18850. In order to minimise Risk we are Buying One Lot of Nifty CE at Strike Price of 18950 and also Buying One Lot of Nifty PE at Strike Price of 18750. This strategy is called Short Iron Fly Strategy
