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In finance, a credit spread, or net credit spread is an options strategy that involves a purchase of one option and a sale of another option in the same class and expiration but different strike prices. It is designed to make a profit when the spreads between the two options narrows.
Put option: A put option gives its buyer the right, but not the obligation, to sell a stock at the strike price prior to the expiration date. When you buy a call or put option, you pay a premium ...
Many options strategies are built around spreads and combinations of spreads. For example, a bull put spread is basically a bull spread that is also a credit spread while the iron butterfly can be broken down into a combination of a bull put spread and a bear call spread.
If the bull put spread is done so that both the sold and bought put expire on the same day, it is a vertical credit put spread. Break even point = upper strike price - net premium received This strategy is also called a put credit spread because the trader will receive a credit (be paid the premium) for entering the position.
In finance, a put or put option is a derivative instrument in financial markets that gives the holder (i.e. the purchaser of the put option) the right to sell an asset (the underlying), at a specified price (the strike), by (or on) a specified date (the expiry or maturity) to the writer (i.e. seller) of the put.
The iron butterfly is a special case of an iron condor (see above) where the strike price for the bull put credit spread and the bear call credit spread are the same. Ideally, the margin for the iron butterfly is the maximum of the bull put and bear call spreads, but some brokers require a cumulative margin for the bull put and the bear call.
The first spread Andrews comes to for an NFL game is simple math, using the power ratings: If Team A is 90, Team B is 91 and at home with a 2.5-point home-field advantage, the line is Team B -3.5.
With his 1987 debut now part of the Criterion Collection, filmmaker Robert Townsend looks back on its making and legacy: 'I broke every rule.'