FAD Iron Condor Strategy
FAD (First Trust Multi Cap Growth AlphaDEX Fund), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.
The First Trust Multi Cap Growth AlphaDEX Fund operates as an exchange-traded fund (ETF). Its central aim is to achieve investment returns that largely reflect the overall performance—encompassing both capital appreciation and income generation—of a particular equity benchmark. This benchmark is known as the Nasdaq AlphaDEX Multi Cap Growth Index, with its performance tracked prior to the subtraction of any management fees or operational costs.
FAD (First Trust Multi Cap Growth AlphaDEX Fund) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $586.1M, a beta of 1.18 versus the broader market, a 52-week range of 150.01-200.22, average daily share volume of 13K, a public-listing history dating back to 2007. These structural characteristics shape how FAD etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.18 places FAD roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. FAD pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a iron condor on FAD?
An iron condor sells a call spread and a put spread at strikes outside spot, collecting net premium that is kept if the underlying stays inside the inner short strikes.
FAD snapshot
As of November 13, 2026, spot at $174.89, ATM IV 21.20%, IV rank 39.33%, expected move 6.08%. The iron condor on FAD below is built from the November 13, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.
Why this iron condor structure on FAD specifically: FAD IV at 21.20% is mid-range versus its 1-year history, so the credit collected on a FAD iron condor sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 6.08% (roughly $10.63 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated FAD expiries trade a higher absolute premium for lower per-day decay. Position sizing on FAD should anchor to the underlying notional of $174.89 per share and to the trader's directional view on FAD etf.
FAD iron condor setup
The FAD iron condor below is built from the November 13, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With FAD at $174.89 on that close, the first option leg uses a $184.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FAD chain at a 35-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 FAD shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Sell 1 | Call | $184.00 | $1.15 |
| Buy 1 | Call | $187.00 | $0.60 |
| Sell 1 | Put | $166.00 | $1.85 |
| Buy 1 | Put | $164.00 | $1.50 |
FAD iron condor risk and reward
- Net Premium / Debit
- +$90.00
- Max Profit (per contract)
- $90.00
- Max Loss (per contract)
- -$210.00
- Breakeven(s)
- $165.04, $184.90
- Risk / Reward Ratio
- 0.429
Max profit equals the net credit times 100 inside the inner strikes; max loss equals wing width minus credit times 100. Two breakevens at inner strikes plus and minus the credit.
FAD iron condor payoff curve
Modeled P&L at expiration across a range of underlying prices for the iron condor on FAD. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | -$110.00 |
| $38.68 | -77.9% | -$110.00 |
| $77.35 | -55.8% | -$110.00 |
| $116.01 | -33.7% | -$110.00 |
| $154.68 | -11.6% | -$110.00 |
| $193.35 | +10.6% | -$210.00 |
| $232.02 | +32.7% | -$210.00 |
| $270.69 | +54.8% | -$210.00 |
| $309.35 | +76.9% | -$210.00 |
| $348.02 | +99.0% | -$210.00 |
When traders use iron condor on FAD
Iron condors on FAD are a delta-neutral premium-collection structure that profits if FAD etf stays inside the inner short strikes; short strikes typically sit near 1 standard deviation from spot.
FAD thesis for this iron condor
The market-implied 1-standard-deviation range for FAD extends from approximately $164.26 on the downside to $185.52 on the upside. A FAD iron condor is a delta-neutral premium-collection structure that pays off when FAD stays inside the inner short strikes through expiration; the wing width should reflect the trader's tolerance for the maximum loss scenario where the underlying breaches an outer strike. Current FAD IV rank near 39.33% is mid-range against its 1-year distribution, so the IV signal is neutral; the iron condor thesis on FAD should anchor more to the directional view and the expected-move geometry. As a Financial Services name, FAD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FAD-specific events.
FAD iron condor positions are structurally neutral / range-bound; the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. FAD positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FAD alongside the broader basket even when FAD-specific fundamentals are unchanged. Short-premium structures like a iron condor on FAD carry tail risk when realized volatility exceeds the implied move; review historical FAD earnings reactions and macro stress periods before sizing. Always rebuild the position from current FAD chain quotes before placing a trade.
Frequently asked questions
- What is a iron condor on FAD?
- A iron condor on FAD is the iron condor strategy applied to FAD (etf). The strategy is structurally neutral / range-bound: An iron condor sells a call spread and a put spread at strikes outside spot, collecting net premium that is kept if the underlying stays inside the inner short strikes. With FAD etf at $174.89 on the November 13, 2026 close, the strikes shown on this page are snapped to the nearest listed FAD chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are FAD iron condor max profit and max loss calculated?
- Max profit equals the net credit times 100 inside the inner strikes; max loss equals wing width minus credit times 100. Two breakevens at inner strikes plus and minus the credit. For the FAD iron condor priced from the November 13, 2026 end-of-day chain at a 30-day expiry (ATM IV 21.20%), the computed maximum profit is $90.00 per contract and the computed maximum loss is -$210.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a FAD iron condor?
- The breakeven for the FAD iron condor priced on this page is roughly $165.04 and $184.90 at expiration, derived from the November 13, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The FAD market-implied 1-standard-deviation expected move in the same options snapshot is approximately 6.08%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a iron condor on FAD?
- Iron condors on FAD are a delta-neutral premium-collection structure that profits if FAD etf stays inside the inner short strikes; short strikes typically sit near 1 standard deviation from spot.
- How does current FAD implied volatility affect this iron condor?
- FAD ATM IV is at 21.20% with IV rank near 39.33%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.