I'm gettin more into options an found out bout ratio spreads.
A call front ratio spreads I'm lookin at on SPX gives me $900 credit (price is -9.00 for the spread). Couldn't I take this an let the contracts expire worthless then keep the $900?
I def feel like I'm missin somethin important here.
Edit: ik it's the weekend and can't buy now. Just lookin at spreads to see what I can do. I tried lookin for videos explaining it but couldn't find anything more in depth.
Posted by TheUnknownParadoxx
4 Comments
Need to know more what are the strikes and expiries. How many short and long legs etc. delta helps
SPX goes above 6479 and you are in a losing position
Oh, this could be a fun follow up a month from now!
If you let it expire and it’s ITM it will cost you a lot of money. Especially since you aren’t even covering both calls you sold. You are only covering 1. Unless you are level 4 and a bunch of cash in your account or a large margin they wouldn’t let you place this, I don’t think, I didn’t look at it real good but I thought you bought 1 and were selling 2. I don’t know though I am still pretty new to options myself but I have been assigned a few times on spreads that I couldn’t sell that expired in the money