The credit spread is an advance option strategy which requires a level 4 approval from your broker. The credit has a lot of similarities to the debit spread in that it is a combination trade of buying (buy to open) and selling (sell to open) an option at the same time of differing strike prices but same expiration. A credit spread can be done with calls or puts. A credit spread with calls is bearish and is referred to as a bear call spread. A credit spread with puts is […]

Debit Spreads Debit spreads are an advance option strategy which requires a level 3 approval from your broker. A basic debit spread is a combination trade of buying (buy to open) and selling (sell to open) an option at the same time of differing strike prices but same expiration. A debit spread can be done with calls or puts. A debit spread with calls is bullish and is referred to as a bull call spread. A debit spread with puts is bearish and is referred to as a bear put […]