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.



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