Welcome back to the "Day Trading for Beginners" podcast! Today's episode, number 21, introduces the basics of option spreads, a crucial topic for those new to trading options. As we approach the end of our comprehensive discussion on options, we're setting the stage for more advanced topics like technical analysis in upcoming episodes.

 
Note: This episode was originally released under the podcast name Day Trading for Beginners, now rebranded as Stock Trading for Beginners.

Resources:

Join our FREE Skool group: https://Skool.com/trading

Download the 6 Month Blueprint: https://stokestrades.com/blueprint

Watch the video on YouTube: https://youtu.be/RBbbGrZiv8g

Access the full article: https://stokestrades.com/option-spreads


In This Episode:

• Introduction to Option Spreads: We break down what option spreads are and how they work. This episode is designed to help beginners understand the structure and utility of spreads in trading options, without diving deep into complex strategies.
• Types of Spreads Explained: We cover the three main types of spreads—vertical, horizontal (calendar), and diagonal—using easy-to-understand examples. Each type is explained in detail to ensure clarity on how they differ based on strike prices and expiration dates.
• Debit and Credit Spreads: Learn the difference between debit and credit spreads and how they impact your trading account. This part of the discussion aims to clarify common confusions related to these terms, especially for those with a background in finance or accounting.
• Practical Examples: We will walk through hypothetical scenarios to illustrate how vertical spreads work compared to buying options outright or purchasing stocks directly. These examples highlight the risk management and cost efficiency of using spreads.

Resources:

• Access the "6 Month Blueprint" I've been following, detailing my journey towards becoming a full-time day trader: StokesTrades.com/blueprint
• Join our growing community on Skool for free, a platform for learning and sharing about options and day trading. No courses for sale, just a supportive environment to grow as a trader. Hit the Community tab on the website. 

Next Steps:

Stay tuned for our next episode where we'll review all we've discussed about options before moving on to technical analysis. Also, look out for visual content on the YouTube channel that complements this discussion with practical demonstrations.

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Join Our Free Community on Skool:

https://www.skool.com/trading