Just touch the frays themselves. The nylon will get on the iron, but if you have that wet sponge to wipe the iron on, you can get the melted nylon off...or wait until the iron is cool and just scrape it off. The problem with a flame is the frays could could catch alight and melt more than you intended. The iron offers better control over the heat but you still need to take care in what you're doing. I worked with nylon "550" parachute cord a lot back in my ol' Air Force days.I wouldn't use a soldering iron. You'd have to work hard to get it close, but not touching, to melt the material without it getting on the iron. Maybe just use a match or lighter?
One other suggestion...if the fray is minor and the cable does't look to be fraying more, just carefully trim the frays with some nail clippers. It's safer than heat and as long as the cable isn't fraying worse (and you don't accidentally cut a wire), is a less risky option...
Cheers and All the Best!
-HK sends
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