• Create BookmarkCreate Bookmark
  • Create Note or TagCreate Note or Tag
  • PrintPrint
Share this Page URL
Help

6.4. Ratio Put Spread

ProficiencyDirectionVolatilityAsset LegsMax RiskMax RewardStrategy Type
+
    +   
ExpertBullishLow• Two Short PutsUncappedCappedIncome
   • Long Put[*]   


[*] Or can be three Short Puts with two Long Puts.

6.4.1. Description

The Ratio Put Spread is the opposite of a Put Ratio Backspread in that we're net short options. This means we're exposed to uncapped risk and can only make a limited reward. As such, this is an undesirable strategy, and you'd be better off trading one of the long butterflies.


PREVIEW

                                                                          

Not a subscriber?

Start A Free Trial


  
  • Creative Edge
  • Create BookmarkCreate Bookmark
  • Create Note or TagCreate Note or Tag
  • PrintPrint