What Is a Credit Spread and How Does It Work
Debit and Credit VerticalsOIC instructor Mark Benzaquen reviews the core mechanics of credit spreads — what a net credit means, how the short and long legs function and why defined risk matters for option sellers.
0:00 Vertical Spreads: Same Month, Different Strikes
0:20 Selling the Expensive Leg for a Net Credit
0:36 The Short Leg Sets Your Direction
1:00 Why Neutral Forecasts Can Still Win
2:25 What Happens If You're Wrong
2:49 The Long Leg as Protection
3:14 Direction vs. Protection in Credit Spreads
4:02 The Defined-Risk Appeal of Spreads
Register to view the complete Understanding Credit Spreads: Mechanics and Applications webinar: https://bit.ly/4vqr8dU.
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