The BEST Credit Spread Option Strategy Video Tutorial

http://www.optionalpha.com - Learn how to trade the Credit Spread Option Strategy with this great video tutorial. Honestly, there is no "magic secret" to trading options. It simply comes down to an understanding of risk management, option pricing and strategy selection. Instead of learning these lessons the hard way (i.e. losing your shirt in the market), why not take my free 4-part video course as I cover each area in detail. Plus, I'll go over the exact checklist I use for selecting trades each month! Start your free 4-part video course here: http://optionalpha.com/free-options-trading-course Whether you're looking to use options trading for hedging and protection or speculation and income, you'll need to know more about how to use options correctly (meaning that you should actually make a profit). That's where we come into play! Just getting started or new to options trading? Here's a quick resource page we made that you'll love: http://optionalpha.com/start-here Because we know you don't have time to sift through our blog for the top posts, we've compiled the best articles for each of the major categories in the above link. Have fun exploring!

Comments

1. so if i buy a vertical spread for 100 and my max is umm 150 do i keep the 100 i invested and also the 150 which would make it 250 or ill just make 50 bucks on this trade.
2. This video could use more details - what type of spread & what specific options were bought/sold relative to the profit/loss graph & price chart; how much of a credit; what to look for before entering; what to watch/adjust during; when to exit....
3. That's a great tutorial. Credit spreads are still the best options strategy for a novice. It's easiest and safest to do
4. Ive never seen a credit spread where the credit is higher than the max loss
5. Do you need to own shares of a security to use this strategy since you are selling puts/calls?
6. In the case where you sold a put with a strike below the stock price, what happens if the stock price drops to or below the
   strike price? Is the Option exercised when the stock price hit the strike price?
   
   Thanks
7. Small error?  The stock price is $18.30, I'm bearish.  Instead of call spread above stock price as in video.  I executed put spread, sell put $22.50 and buy put $21.50.  If stock price stays below $21.50, I keep the premium, right?  Thanks
8. You can sell calls Jonathan.  I think one big difference is that with credit spreads you dont need to have 100 shares of the stock to sell a credit spread.  You could put up alot less money like $150 and you have the possibility of making a large percentage - say 35% on that 150 capital. 
9. Your video are great! I recommend people that want . To learn options, to look you up! Thanks for giving back! May you have a wonderful and prosperous New year's!
10. I still don't understand how you are only losing less than you are profiting?  Most of the time I've seen this exact strategy risk the loss of more money than it would have profited.  This of course is from my experience watching videos and reading about the spreads.  I have not traded options yet because I am weary about them.   My biggest concern is what happens when you have to fill that option you wrote because it's been called?  My point is it's almost time for expiration and now the option you wrote is being called, but you don't have time to call on the the option you bought...does that make since?  Even if you use this strategy you can't just call on the other option that you just bought because it has already expired...right?
    
    I'm still kinda lost when it comes to options, probably because I expect contracts to be fulfilled, not just expire all the time.    
11. Why do you buy the call, why not just sell covered calls and let them expire? 
12. It's basically half of an iron condor.
13. that looks like a SPY chart from 2010
14. Is it possible to buy monthly options a bit out of the money or at least far enough you could sell on price closer. If it is would it be possible to buy a monthly option and sell the weeklys one strike closer and let the one sold expire and sell the other and keep the profits, assuming that after you sold both options you would have a profit??
15. I do agree....I think that P/L chart belongs to a Debit Spread strategy. Regards!
16. tottaly agree!