How are PAA 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 PAA iron condor priced from the end-of-day chain at a 30-day expiry (ATM IV 18.16%), the computed maximum profit is $34.50 per contract and the computed maximum loss is -$65.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a PAA iron condor?

The breakeven for the PAA iron condor priced on this page is roughly $21.16 and $24.35 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 PAA market-implied 1-standard-deviation expected move is approximately 5.21%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current PAA implied volatility affect this iron condor?

PAA ATM IV is at 18.16% with IV rank near 27.29%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.

PAA Iron Condor Strategy

PAA (Plains All American Pipeline, L.P.), in the Energy sector, (Oil & Gas Midstream industry), listed on NASDAQ.

Plains All American Pipeline, L.P., through its subsidiaries, engages in the pipeline transportation, terminalling, storage, and gathering of crude oil and natural gas liquids (NGL) in the United States and Canada. The company operates in two segments, Crude Oil and NGL. The Crude Oil segment offers gathering and transporting crude oil through pipelines, gathering systems, trucks, and at times on barges or railcars. This segment provides terminalling, storage, and other facilities-related services, as well as merchant activities. As of December 31, 2021, this segment owned and leased 18,300 miles of active crude oil transportation pipelines and gathering systems, as well as an additional 110 miles of pipelines that supports crude oil storage and terminalling facilities; 74 million barrels of commercial crude oil storage capacity; 38 million barrels of active, above-ground tank capacity; four marine facilities; a condensate processing facility; seven crude oil rail terminals and 2,100 crude oil railcars; and 640 trucks and 1,275 trailers. The Natural Gas Liquids segment engages in the natural gas processing, NGL fractionation, storage, transportation, and terminalling activities.

PAA (Plains All American Pipeline, L.P.) trades in the Energy sector, specifically Oil & Gas Midstream, with a market capitalization of approximately $15.44B, a trailing P/E of 13.50, a beta of 0.48 versus the broader market, a 52-week range of 15.69-23.04, average daily share volume of 3.4M, a public-listing history dating back to 1998, approximately 4K full-time employees. These structural characteristics shape how PAA stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.48 indicates PAA has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. PAA pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a iron condor on PAA?

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 PAA snapshot

As of May 15, 2026, spot at $22.89, ATM IV 18.16%, IV rank 27.29%, expected move 5.21%. The iron condor on PAA 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 PAA specifically: PAA IV at 18.16% is on the cheap side of its 1-year range, which means a premium-selling PAA iron condor collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 5.21% (roughly $1.19 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 PAA expiries trade a higher absolute premium for lower per-day decay. Position sizing on PAA should anchor to the underlying notional of $22.89 per share and to the trader's directional view on PAA stock.

PAA iron condor setup

The PAA 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 PAA near $22.89, the first option leg uses a $24.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PAA 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 PAA shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Sell 1	Call	$24.00	$0.18
Buy 1	Call	$25.00	$0.02
Sell 1	Put	$21.50	$0.20
Buy 1	Put	$20.50	$0.01

PAA iron condor risk and reward

Net Premium / Debit: +$34.50
Max Profit (per contract): $34.50
Max Loss (per contract): -$65.50
Breakeven(s): $21.16, $24.35
Risk / Reward Ratio: 0.527

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.

PAA iron condor payoff curve

Modeled P&L at expiration across a range of underlying prices for the iron condor on PAA. 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%	-$65.50
$5.07	-77.9%	-$65.50
$10.13	-55.7%	-$65.50
$15.19	-33.6%	-$65.50
$20.25	-11.5%	-$65.50
$25.31	+10.6%	-$65.50
$30.37	+32.7%	-$65.50
$35.43	+54.8%	-$65.50
$40.49	+76.9%	-$65.50
$45.55	+99.0%	-$65.50

When traders use iron condor on PAA

Iron condors on PAA are a delta-neutral premium-collection structure that profits if PAA stock stays inside the inner short strikes; short strikes typically sit near 1 standard deviation from spot.

PAA thesis for this iron condor

The market-implied 1-standard-deviation range for PAA extends from approximately $21.70 on the downside to $24.08 on the upside. A PAA iron condor is a delta-neutral premium-collection structure that pays off when PAA 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 PAA IV rank near 27.29% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on PAA at 18.16%. As a Energy name, PAA options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PAA-specific events.

PAA 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. PAA positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PAA alongside the broader basket even when PAA-specific fundamentals are unchanged. Short-premium structures like a iron condor on PAA carry tail risk when realized volatility exceeds the implied move; review historical PAA earnings reactions and macro stress periods before sizing. Always rebuild the position from current PAA chain quotes before placing a trade.

Frequently asked questions

What is a iron condor on PAA?: A iron condor on PAA is the iron condor strategy applied to PAA (stock). 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 PAA stock trading near $22.89, the strikes shown on this page are snapped to the nearest listed PAA chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are PAA 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 PAA iron condor priced from the end-of-day chain at a 30-day expiry (ATM IV 18.16%), the computed maximum profit is $34.50 per contract and the computed maximum loss is -$65.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a PAA iron condor?: The breakeven for the PAA iron condor priced on this page is roughly $21.16 and $24.35 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 PAA market-implied 1-standard-deviation expected move is approximately 5.21%; 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 PAA?: Iron condors on PAA are a delta-neutral premium-collection structure that profits if PAA stock stays inside the inner short strikes; short strikes typically sit near 1 standard deviation from spot.
How does current PAA implied volatility affect this iron condor?: PAA ATM IV is at 18.16% with IV rank near 27.29%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.