AVOID Credit Spreads

Ive been doing last second 0dte credit spreads and average 15% a day

It's the safest method of trading. Depending how wide, you can have a higher chance of winning. Set up a stop loss system and it's fine. I'm in a group that uses them just fine

i only sell put on share i wanna buy. i only buy blue chip companies. same way i play option. only blue chip companies. most likely mag 7

i love option. turn my 40k to $160k in 13 months. and that include took 15k out to pay tax. and i dunno much.

What do u mean small accounts? Define that?
35k in my opinion is small. But is it?

cash secured put - put away strike price x 100. receive credit from sold put. max loss below the put minus credit received. Bullish option
covered call - put away 100 shares (similar to cash secured put) but you're buying at market price. receive credit from sold calls. max loss below the call strike minus credit received. Neutral option.
credit spread - put away nothing. sell call or put for credit. buy call or put otm for debit BUT less than credit. max loss when price rise or fall TO the OTM call or put.
cap the earning but also the loss. Neutral option strategy.
debit spread - put away debit. buy call or put. sell call or put cheaper OTM for credit. max loss limited by debit paid. max gain unlimited. bullish or bearish option strategy.

The problem is that trading is an art, a science, and a feel - everyone's personal traits will look at a system and execute it differently. What works for one doesn't necessarily work for another. Seeking system after system or trying to emulate someone else's is unlikely to work. It's more important to understand what you are doing. There are a lot of nuances to options trading, and after 5 years of it I'm still learning. These days AI can really help educate you. With that being said, I only made it half way through this video. He is not giving a wise example. TSLA is freaking expensive. He is going off the delta as though it is a static prediction of the future. It is only valid for the moment you see it, it can change rapidly, and even a .30 delta doesn't say 'guaranteed to not get there'. When trading something way too big for your account, which is utterly foolish to begin with and not the sign of a disciplined trader, you have to go 'way out of the money'. With that approach you'll make less but lose less, which is the more conservative (smart) way to trade credit spreads even for lower priced tickers within your budget, with occasional 'closer to the money' spreads when you have a significant reason to feel good about them AND going the wrong way won't kill your profits. The example given here is the way NOT to trade spreads. There are far better videos here that show a more realistic and profitable way to handle them.

Thank You sir, You are absolutely correct, credit spreads are trash and not worth the risk to reward ratio.

So true, avoid

I agree that PCS can be dangerous if you are not exactly know what you are doing and how to set Stop Market orders for an SL and a TP Order - at the end of the day, when you are know what you are doing YOU CAN grow small accounts fast and generate weekly or even daily income even on small account but frankly spoken, when you know what you are doing you have no small account normally - in sum you can do it if you get good at it and do only this, Even I do it sometimes all though I spin the wheel the whole mite with cash secured puts and CC`s and love to trade LEAPS just because I can archive the same result with less amount of capital binded, that's about it!

so your better off buying calls

dont run puts lol. 10 second google search will tell u to go for .10 deltas or below and BCS on etfs. research is important

Bull put spreads on SPY, QQQ, IWM. 30 DTE, 15 Delta.

When gambling on futures isn't exciting enough... Why not throw away your money on options instead !?

I 100% agree, beginners should stay away. For me it is my go to strategy. I only do it in the SPY, I reserve enough capital to widen and roll if need to a free different times and prefer to go on the call side. I have developed a very specific set of rules that have been developed through some lessons at the beginning. But 100% agree, not get rich quick. Just looking for daily and weekly income. You are the man Brad!

Problem is that even if the underlying price doesn't go below your short strike, just comes close, you're still fucked because you can't close it out for a profit at that point. and if you let it ride its the total loss scenario.

You are 10000% correct my man. Spreads are complete trash. Just ONE trade can smoke you and you can lose months of premium you earned. With a CSP you actually end up with an asset if you get assigned and you can always offload it when it goes back up and get your money back. Spreads are complete TRASH. Its pure gambling no wonder you get smoked so bad.

Been trading credit spreads since 2012. I would say that i have cagr of 30+% annual.

The past 3 years the cagr for me is 34+%. I have had a few gut wrenching episodes. In the early years had a few 50%+ draw downs.

The trick to trading (any style of trading as a professional) is risk management with a reasonable edge in your method. No edge, not a survivability method.

Liars in the comment section. You are doing God's work by making this video. Say NO to Credit Spreads.

If you don't understand them then yes, not a good idea. Know the probabilities when using these instruments. Also, know how to manage them bull and bear. But, you have taken a haircut in your wheel and CS puts as I remember. These are not cheating the market these are using the market. You can be burned as you call it in any option instrument.

You made loss because you did not know when to adjust (close) your trade, doesn't mean credit spreads are bad. If you create a credit spread and based on 72% POP you think "oh I will go on a vacation without monitoring", yes my friend, you will get smoked, which seems to have happened to you. Instead of saying spreads are bad, a meaningful video would be, the mistakes that you made so that others can learn from it.

but why doing creditspread with stocks? Why not chossing for indices that settle ion cash (cash settlement)?? No risk of early to buy stocks.

I agree with Brad, credit spreads is not for beginners or mid level traders.

Credit spreads can be very effective when traded with a defined edge, proper backtesting, and disciplined risk management. Longer-dated setups tend to work best, and success comes from managing both losses and gains. Emotional trading, on the other hand, rarely produces consistent profits.

had a couple weeks of consistent wins on 0dte Spy condors...."I'm a trading genius! What's the point of even being poor!". One day....drumpf said something or other....big red day....blew through everything....I get SMOKED!

Credit spreads are good, just don't do them on TSLA, and don't do them near the money. Manage your risk and understand your stock.

He was so confident the comments would be on his side lmao

Credit spread for momentum bullish & highly volume stocks , is it a good strategy ?

I was in similar situation, traded Credit Spreads for META and got burnt!

He spends the first 4 minutes telling you he doesn't like credit spreads. Only then does he start telling you why.

The last several years I have been trading credit speads and iron condors with good success. 16-20 delta on the short and 5-20 wide depending on the price of the underlying. My PoP is generally 65-85% at open. I go 40-60 DTE. These are usually 4:1 risk:reward. 1600:400 is typical. I close them at 50-80% profit or $500 loss. I almost always close before 10 DTE. My yearly return has been ~30%. I never swing for a home run, just lots and lots of ground ball base hits. ~15-20 trades/monthly.

Credit spreads have a lousyrisk to reward ratio. You lose once and you would have lost about two weeks worth of premiums assuming you do one every day. You need to understand how to determine with HIGH probability your short option and long option strike prices are such that the market price never breaches the short option strike prices. That is a whole different topic of discussion. I tend to prefer debit spreads with a high probability of having the long and short option strike prices breached.

I definitely got smoked a week ago and it definitely was a very huge loss...I see where your coming from now

I am very conservative and do not swing for the fences. I sell naked puts 45 -60 DTE at around 20% down from the current price. The premium is not high, but with naked puts, I only need to have 20 to 30 percent sitting in the account as collateral. This makes the smaller premium a decent return. Still, only stocks I want to own. I have cash available sitting in fund paying around 4% that serves as collateral. All of my money is constantly working. If you are trying to make a living doing this, it might not bring the returns you want. But for an old retired guy like me, making 30 - 50 percent on my money is a blessing.

I've traded options over the years and had some success, but ultimately gotten smoked in the end. I've never traded a spread. So as basically an outsider looking in I see a 1:2 profit loss ratio, and tens of thousands of dollars in capital required to be doing it correctly. Maybe I'm getting this wrong but if the spread expires between the sold and bought options, you get assigned but eat the difference. If selling puts as a way of buying the underlying with the premium discounting the price, it seems like I'm catching a falling knife, because at that point the underlying has moved opposite of my prediction and I guess I'm hoping it's a short term pull back? Hope is not a strategy.

Maybe you don’t know how to trade credit spreads correctly?

Been Options Trading for the last 6 months and I've been using Credit Spreads with success, but I've quickly learned that you need to factor in Proability of Success and Risk / Reward Ratio's. To me this is so fundamental to veer away from gambling on options to actually utilizing data to gain insight into proabiliy of success. As an example a Risk / Reward rate of 25%, 1:3 is starting to tilt odds in my favor. The key point is the loss, you really don't want to blow up your total gains on one trade. so that means scaling back the possible loss. As I'm quickly learning is Options have a number of stratiges for trading, like any tool, use the best one that fits what the market is doing. Its not a 1 strategy fits all. So alot more to learn on my end, but its been a blast so far...

the way you look at pcs is the reason you lost on pcs😂

Credit spreads work great on trending stocks. Using the Ichimoku Cloud (conversion or baseline bounces or rejections depending on the direction), width of at least 33% or more, 30 or less DTE, looking for a target exit of 30% of the width collected, easiest money ever.

You have to manage the trade and not be greedy. Put credit spreads on bullish trends. Call credit spreads on bearish.

You’ll be fine 💪🏽👌🏽

Credit spreads have not worked in this market and I have lost more money because when they start tanking broker is going to force you to sell to destroy your account to meet margin calls I did debit spreads and selling gives you small change compared to thousands you losing on the other leg.

This guy is right. Dont believe all the BS you hear on youtube. The TRUTH is that credit spreads carry CONSIDERABLE RISK.

He is 100% right your wins are small your loses are large. NOT worth the Considerable risk.
And you can be assigned at ANY Time.

This is the best advice and option trader can have, 🙏i agree with everything u said

“Institutions don’t use options to make a fortune — they use them to not lose one.”