vertical spread tips for beginners

Personally, I find that it's important to have a clear understanding of the market conditions and trend before selecting the best strike prices for the spread.

For example, in a bullish market, I might use a bull call spread by purchasing a call option with a lower strike price and simultaneously selling a call option with a higher strike price. This allows me to limit my potential losses while still benefiting from upward moves in the stock price.

e.g.To create a bullish vertical call spread, you can buy-to-open a $50 call option and sell-to-open a $55 call option. By doing this, you limit your potential losses while still allowing yourself to profit from an increase in the underlying asset's price.

In a bearish market, I might use a bear put spread by purchasing a put option with a higher strike price and simultaneously selling a put option with a lower strike price. This strategy limits my potential losses once again while still allowing for some profit from downward moves in the stock price.

However, it's important to note that vertical spreads may not always be the best approach in every market condition. It's important to assess each market situation individually and choose the appropriate strategy based on your investment goals and risk tolerance.Options trading is very complicated and requires a precise trading strategy lol... but this market is sexy enough for me to continue