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<p id="isPasted">You should start with something simple. Vertical spreads are puts or call option that you use strike price on different intervals. Each spread has two legs, where one leg is buying an option, and the other leg is writing an option.</p><p>Vertical spreads allow to trade directionally while clearly defining maximum profit and maximum loss on entry (known as defined risk).You can always sell and buy new option, keep in mind if the market is going against the option exercised value the cheaper it is</p>
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<p id="isPasted">A good strategy for trading options spreads involves first assessing your market outlook (bullish, bearish, or neutral) and risk tolerance, and then selecting a suitable multi-leg strategy such as a vertical spread, iron condor, or straddle/strangle to define your risk and potential reward. </p><p id="isPasted"><strong>Always keep in mind these risk Management Principles:</strong></p><ul><li>Define Your Outlook: Match your strategy to your view on the market's direction and expected volatility.</li><li>Position Sizing: Never risk more than a small percentage (e.g., 2-5%) of your total trading capital on a single trade.</li><li>Use Stop Losses: Have a plan to exit a losing position to preserve …</li></ul>
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