{"id":218154,"date":"2026-08-25T11:01:33","date_gmt":"2026-08-25T05:31:33","guid":{"rendered":"https:\/\/univest.in\/blogs-2\/?p=218154"},"modified":"2026-08-25T11:01:34","modified_gmt":"2026-08-25T05:31:34","slug":"iron-butterfly-nifty-midcap-select","status":"publish","type":"post","link":"https:\/\/univest.in\/blogs-2\/iron-butterfly-nifty-midcap-select\/","title":{"rendered":"Iron Butterfly Nifty Midcap Select: Setup, Payoff and Risk Guide"},"content":{"rendered":"
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Nifty Midcap Select level used in this article: Rs 13,850 (as of illustrative reference level; verify current level on NSE). Next monthly (last Tuesday of the month) expiry: 25 August 2026 (Tuesday). Lot size 120. Weekly options on Nifty Midcap Select were discontinued in November 2024 under SEBI’s one weekly index per exchange rule; only monthly contracts remain.<\/em><\/p>\n

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Quick Answer<\/strong><\/p>\n

The iron butterfly Nifty Midcap Select combines a short at the money call and a short at the money put, at the same strike, with a long out of the money call and a long out of the money put as protective wings on either side, all on the same expiry. With Nifty Midcap Select at Rs 13,850, the iron butterfly Nifty Midcap Select collects a net credit at entry, which is the maximum profit, realised when the index closes exactly at the centre strike at expiry. Unlike a standard butterfly spread, which uses only calls or only puts, the iron butterfly Nifty Midcap Select mixes both calls and puts, but the two structures produce a very similar defined risk payoff shape.<\/p>\n<\/div>\n

The this strategy can be thought of as a defined risk version of a short straddle: the short call and short put at the centre strike generate the bulk of the premium, similar to a short straddle, but the long wings on either side cap the otherwise unlimited risk that a naked short straddle would carry.<\/p>\n

Because the short strikes in the iron butterfly Nifty Midcap Select are both at the same at the money level, the position has a narrower profit zone than an iron condor, which separates its short strikes, but it typically offers a larger net credit for that reduced profit zone width.<\/p>\n

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