What are Option spreads

What are Option spreads

 

Option spreads goes to the heart of Options trading. Once you’ve mastered Option spreads, you’re now in a position to maximize your return opportunities from Options trading.

 

Many newcomers to Options are scared of spreads – when in fact, the primary advantage of spreads is either to reduce costs or reduce risks. There are two kinds of Option spreads – Credit spreads and debit spreads.

 

And within these categories there are 4 Option spreads – the Bull Call spread, the Bear Call spread, the Bull Put spread and the Bear Put spread.

 

But why use Option spreads ? And what advantages do they provide the options trader ?

 

Here’s a video that briefly describes the concept. For more information on these spreads, please refer to Module 4 of the OptionTiger courseware.

 

 

Leave A Response

* Denotes Required Field