What is debit spread and credit spread? in option trading, pls tell me in layman term? related questions

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What is debit spread and credit spread? in option trading, pls tell me in layman term?0dukegirl2012-10-22 20:44:57
What is the spread of debit and credit spread ? in transactions involving options , pls tell me in layman's term ?
Can being assigned while doing a call vertical option spread make you more money than just a regular spread.?1HALP YO2012-11-04 05:43:05
In general I have heard on the boards of a fear of being assigned to play options. When I analyzed my vertical spread I concluded that it might be a good thing, but I was not sure if my math is what I am asking for a check on it. MedlinePlus MedlinePlus Let's say you were assigned to 2 days before because the offer ask spread was a little out of place and it was better for the owner to exercise the option to sell back Inseat. I have a call vertical spread where I went over the 45 and the 48 sold short. Short call was assigned to me and now I'm short file -100 to 48 bases and still I have my call 45. (For simplicity ignore sick debit paid to do the trade). Suppose that the underlying stock is 50. I guess if I end trade now I lost $ 200 in the short 48/50 -100 and won $ 500 in calling for profit of $ 45 300. That is the maximum that could have made the trade if it had sold the vertical. If the underlying stock goes up or down over the next two days I think I keep my profit of $ 300 because the long and short -100 only move together. However, if the underlying stock falls I'm also garunteed at least $ 300 but I think even I could get more. MedlinePlus MedlinePlus when I drop below the strike price of 45 -100 calls short and not compensated for losing money on buying long call. Di underlying drops to 40, due to an oil rig exploded or something. When I sell my calling long I would get nothing, as it is below 45, but my short -100 is now worth $ 800 because my base in the short -100 is 48. So basically a call vertical spread with a maximum benefit of $ 300 may be worth a lot more because of the assignment. I realize you have to pay the interests and concerns of margins, but is correct basic mathematics presented here, it is assigned may be a good thing?
Do you have to use margin to do an option credit spread?0Jodi2012-09-07 03:07:02
For trade and inexpensive stocks put call ? say , Blockbuster or Fannie Mae ?
How do i close out this debit spread?0Pravinesh2012-07-14 07:56:02
I currently hold a Jan. 13 RIMM 20/27.5 call spread. I bought the 20 call for .93 and sold the 27.5 for .32 making my cost $.61... I want to know how to close this trade, I plan to close it outright instead of exercising or selling the legs individually. My trade platform gives me the option to put in a limit/debit or a limit/credit, I am a bit confused as to what that means,,,, can someone explain what I should do if hypothetically RIMM traded at 25 by January, would I the spread with a limit/credit or limit/debit order?? It is a debit spread so do I close it with a limit/credit order? Any help is greatly appreciated! Thank you :)
How can I use the call spread in an option trading?0traivonn2012-10-14 10:00:55
I just learn option trading and do not know how to use the extension called . Any idea ? Thank you.
What is a bull-put credit spread (referring to trading AMZN)?0Nazgul2012-09-02 23:30:02
What is spread trading? How/Why is it better than regular trading? Why should I spread trade equities?0y9122012-08-04 07:07:02
I have the intention to use the software spread trading is hitting new markets in India soon and let me know if it's worth .
Is following the medium-long term trend the best way to spread bet currencies?0toxic alien 2012-10-09 01:08:43
Just curious I have a question about spread betting on currency markets or forex and if the best way to negotiate is following the trend in the medium term and long term , that is, a few weeks to a few months? Is this the best way to negotiate , as that is what I did with my practice account and got 426% in two weeks ? Is this the best way to do that I know usually currency long-term trend ? Please help / advice. Thank you.
Buying a option spread?0chevy2012-10-12 10:07:17
looking to trade an option spread with maturity less than April. What is the best trade. What should be my job MedlinePlus What should I buy based on risk reward MedlinePlus against I just want to risk $ 1000 MedlinePlus I want to buy the 2.5 and sell stop MedlinePlus 5 7.5 10 12.5 to 15 Also each month spreads trade at different prices which is best to put an offer in that run
Bear call credit spread on options trade on LULU?1madzia2012-09-14 18:54:06
Short MAR 62.50 . Long MAR 67.50 . Credit of $ 1.23. I had hoped that the act of filling the void and then when I did not roll the trade maturity due in February March. I'm still waiting for the gap to be filled, but the payoff is March 8 . Any suggestions ?
Why is Cap Spread Trading Illegal in the U.S.A.?0Webbie2012-09-18 06:18:03
Why O ' Why? I have a friend in the UK , which boasts on its Cap spreads and how superior account of FX - lots / etc minilots MedlinePlus He makes life worth its business.
Are day trading day are over because of the very tiny ask/bid spread?0Sabrina Goodridge2012-08-01 13:11:54
i was just wondering if people still do it because, usually the spread is so tiny, a penny, i dont see why anyone would bother? since you would need to buy thousands shares, well over 10, to make some profit, but this will lower the price, and then, try getting rid of 10 000 shares at the same time.

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