LABD Iron Condor Strategy
LABD (Direxion Daily S&P Biotech Bear 3X ETF), in the Financial Services sector, (Asset Management - Leveraged industry), listed on AMEX.
The Direxion Daily S&P Biotech Bull and Bear 3X ETFs seek daily investment results, before fees and expenses, of 300%, or 300% of the inverse (or opposite), of the performance of the S&P Biotechnology Select Industry Index. There is no guarantee the funds will achieve their stated investment objectives.
LABD (Direxion Daily S&P Biotech Bear 3X ETF) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $30.2M, a beta of -3.15 versus the broader market, a 52-week range of 12.465-99.5, average daily share volume of 5.0M, a public-listing history dating back to 2015. These structural characteristics shape how LABD etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of -3.15 indicates LABD has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. LABD pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a iron condor on LABD?
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.
Current LABD snapshot
As of May 13, 2026, spot at $13.13, ATM IV 96.40%, IV rank 45.87%, expected move 27.64%. The iron condor on LABD below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 28-day expiry.
Why this iron condor structure on LABD specifically: LABD IV at 96.40% is mid-range versus its 1-year history, so the credit collected on a LABD iron condor sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 27.64% (roughly $3.63 on the underlying). The 28-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated LABD expiries trade a higher absolute premium for lower per-day decay. Position sizing on LABD should anchor to the underlying notional of $13.13 per share and to the trader's directional view on LABD etf.
LABD iron condor setup
The LABD iron condor below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With LABD near $13.13, the first option leg uses a $14.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed LABD chain at a 28-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 LABD shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Sell 1 | Call | $14.00 | $1.80 |
| Buy 1 | Call | $14.50 | $1.53 |
| Sell 1 | Put | $12.50 | $0.60 |
| Buy 1 | Put | $12.00 | $0.59 |
LABD iron condor risk and reward
- Net Premium / Debit
- +$28.50
- Max Profit (per contract)
- $28.50
- Max Loss (per contract)
- -$21.50
- Breakeven(s)
- $12.22, $14.29
- Risk / Reward Ratio
- 1.326
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.
LABD iron condor payoff curve
Modeled P&L at expiration across a range of underlying prices for the iron condor on LABD. 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 | -99.9% | -$21.50 |
| $2.91 | -77.8% | -$21.50 |
| $5.81 | -55.7% | -$21.50 |
| $8.72 | -33.6% | -$21.50 |
| $11.62 | -11.5% | -$21.50 |
| $14.52 | +10.6% | -$21.50 |
| $17.42 | +32.7% | -$21.50 |
| $20.32 | +54.8% | -$21.50 |
| $23.23 | +76.9% | -$21.50 |
| $26.13 | +99.0% | -$21.50 |
When traders use iron condor on LABD
Iron condors on LABD are a delta-neutral premium-collection structure that profits if LABD etf stays inside the inner short strikes; short strikes typically sit near 1 standard deviation from spot.
LABD thesis for this iron condor
The market-implied 1-standard-deviation range for LABD extends from approximately $9.50 on the downside to $16.76 on the upside. A LABD iron condor is a delta-neutral premium-collection structure that pays off when LABD 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 LABD IV rank near 45.87% is mid-range against its 1-year distribution, so the IV signal is neutral; the iron condor thesis on LABD should anchor more to the directional view and the expected-move geometry. As a Financial Services name, LABD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to LABD-specific events.
LABD 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. LABD positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move LABD alongside the broader basket even when LABD-specific fundamentals are unchanged. Short-premium structures like a iron condor on LABD carry tail risk when realized volatility exceeds the implied move; review historical LABD earnings reactions and macro stress periods before sizing. Always rebuild the position from current LABD chain quotes before placing a trade.
Frequently asked questions
- What is a iron condor on LABD?
- A iron condor on LABD is the iron condor strategy applied to LABD (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 LABD etf trading near $13.13, the strikes shown on this page are snapped to the nearest listed LABD chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are LABD 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 LABD iron condor priced from the end-of-day chain at a 30-day expiry (ATM IV 96.40%), the computed maximum profit is $28.50 per contract and the computed maximum loss is -$21.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a LABD iron condor?
- The breakeven for the LABD iron condor priced on this page is roughly $12.22 and $14.29 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current LABD market-implied 1-standard-deviation expected move is approximately 27.64%; 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 LABD?
- Iron condors on LABD are a delta-neutral premium-collection structure that profits if LABD etf stays inside the inner short strikes; short strikes typically sit near 1 standard deviation from spot.
- How does current LABD implied volatility affect this iron condor?
- LABD ATM IV is at 96.40% with IV rank near 45.87%, 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.