10mon
MarketBeat on MSNHow to Choose Between an Options Debit Spread or Credit Spread?When you want to make a bet on a stock price move, you can use stock options for a fraction of the cost of owning the stock.
Depending upon your strike selection, as well as the ratio of puts purchased to puts sold, it may also be possible to initiate the put ratio spread for a net credit. In this case, the potential ...
(Since a short put spread is always initiated for a net credit, it falls under the category of "credit spreads.") Your initial net credit of $45 is the most you stand to make on the trade.
When setting up a short put spread, the short put is more expensive than the long put since the short put is closer to the money, resulting in a net credit. Buying a put at a lower strike price ...
When setting up a short put spread, the short put is more expensive than the long put since the short put is closer to the money, resulting in a net credit. Buying a put at a lower strike price ...
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