CBF raises a good point:
What is the benefit of selling** iron condors (bull put spread/bear call spread) over buying condors (bear spread/bull spread – puts or calls, but not both)? The profit/loss graphs of the IC and the condor are identical. Clearly, with the IC the cash remains in your account and is increased by the premium collected rather than paying for the condor and collecting a profit (hopefully) later on, but the interest earned on the funds is, at least presently, negligible. Also, it appears that there might be a slightly greater premium for an IC over a condor, but I don't have enough of a statistical sample to draw that conclusion.
So, why are iron condors so popular while non-iron condors are rarely mentioned?
1) It's true that iron condors receive a great deal of attention. One big reason for that: it's the strategy of choice for hypesters who want people, who know nothing about options, to pay them to manage a portfolio of iron condors. Money management is a profitable business, as the managers keep 20% of all profits with no risk of loss. Of course one must be licensed to manage other people's money and I have no idea whether that rule is obeyed.
Others offer to sell trade recommendations to newbies for far more cash than the information is worth. Ads that promise to 'generate a steady monthly income.' and trade with a success rate of between 80 and 95% attract suckers customers. It all sounds so attractive and the messages come with a hard sell that apparently works. I have no idea how many people pay high fees to have someone recommend iron condor trades, but there are plenty of them. Some of these people run a legitimate business. They are careful in choosing their trades and manage risk with skill. But it's difficult to know whom you are hiring when you go that route.
There are (or at least were) a bunch of hedge funds that charged hefty management fees to trade an iron condor portfolio.
Then there are brokers (thinkorswim comes to mind) who encourage the use of iron condors. Don't get me wrong, there's nothing wrong with that. I also encourage their use, as long as it's accompanied with careful risk management.
2) The reason these strategies have the same risk graph is that the positions are equivalent. Assuming options are priced efficiently, as they are almost all the time, there is no 'real' advantage to trade an iron condor rather than a condor.
But, there is a psychological advantage, and my guess is that's the reason iron condors are far more popular. It's just 'fun' to sell premium and watch the price of those options fade away.
3) **The condor and iron condor are equivalent. If one buys the condor – as in your example, then (to me and a number of brokerage houses) the equivalent position is also a 'buy.' Thus, buying an IC is equivalent to buying a condor, and, I use the verb 'to buy' when opening an iron condor position. Others believe that collecting cash means, by definition, that you are selling the IC. There is no commissioner of nomenclature, so this disagreement goes on.
You refer to the 'bull call spread.' Yes that is the spread being sold. I believe using the term bull and bear are not only unnecessary, but adds confusion. The call spread, by definition, is buying the lower strike (more valuable) option. Thus, you either buy or sell the call spread. Why get the issue confused by having to think about the difference between buying a bull call spread and buying a bear call spread? There is no need to define it as bullish or bearish – it's just a call spread.
Likewise, buying the put spread refers to buying the more costly put option. When buying an iron condor, you sell both the call spread and the put spread. Once again, this is not universally accepted.
4) Options tend to be priced efficiently and that means there should never be an advantage to buying either position. But sometimes one of the options is mispriced (probably because an individual investor is trying to buy or sell a few contracts), and there could be an edge in the pricing of a condor compared with an iron condor.