Iron butterfly on Nifty 50
A short straddle with protective wings: sell the at-the-money call and put, buy a call above and a put below. Shown per lot of 65 with illustrative numbers.
Contract basics. Nifty 50 lot size: 65. Nifty 50 has weekly options expiring every Tuesday, so this example uses 7 days to expiry. Strikes in this example are rounded to the 50-point strike interval.
A structure for a view that the index will end very close to its current level, with losses capped by the wings.
| Leg | Premium per unit | Cash flow |
|---|---|---|
| Buy 1 lot 24,250 PE | ₹10.20 | −₹663 |
| Sell 1 lot 25,000 PE | ₹178.07 | +₹11,575 |
| Sell 1 lot 25,000 CE | ₹209.21 | +₹13,599 |
| Buy 1 lot 25,750 CE | ₹15.76 | −₹1,025 |
Profit and loss at expiry
For the whole position, before charges.
Premiums are theoretical Black–Scholes values from round, illustrative inputs, not market prices. Charges and margin are not included.Price a single leg with your own numbers.
Frequently asked questions
What is the maximum loss of an iron butterfly on Nifty 50?
In this illustrative example, ₹25,264 per set of legs (lot size 65), before charges.
What is the lot size of Nifty 50 options?
65 units per lot at the time of writing. Lot sizes are revised by the exchange from time to time; check the current size before trading.
When do Nifty 50 options expire?
Nifty 50 has weekly options expiring every Tuesday, so this example uses 7 days to expiry.
How is an iron butterfly different from an iron condor?
The butterfly sells the same at-the-money strike for the call and the put, so it collects more premium but profits in a narrower range.
What is the maximum loss?
The distance to a bought wing minus the net premium, times the lot size.