LD Lossdog Research
strategy

credit spread

9 matching records.

Trade idea

AAPL credit spread

The trade involves a short credit spread on Apple (AAPL) with the 220 calls short and 235 calls long. The strategy is based on the assumption that the stock will remain above 320, and the trader is bearish on the stock. The trade is managed by staying in the position unless the stock price moves significantly against the trade. The trader suggests that if the stock price is above 320, there is nothing to do, but if the stock price is below 320, the trader can sell out of the money put spread against it. The trade is considered a credit spread, and the trader is looking to collect the premium from the spread.

View full notes
Strategycredit spread
Assetstock
ExpirationAugust 21st
Time horizonUntil expiration
Entry / triggerStock price above 320
Target / exitCredit received from the spread
Invalidation / stopIf the stock price moves significantly against the trade
SpeakerMark
Structure / legs
  • short 220 calls
  • long 235 calls
Risks
  • If the stock price moves significantly against the trade, the trader may lose money
  • The trade is subject to the expiration date, and the trader may need to adjust the position if the stock price moves significantly against the trade
shortEquityshortcredit spreadAAPL
high confidenceVerify in video at 29:26 ↗
Trade idea

RTY credit spreads

The speaker mentions selling credit spreads or puts against the RTY with a snark, indicating a short-term, high-volatility strategy. This approach is suitable for traders looking to capitalize on near-term price movements, though it requires careful monitoring due to the limited time horizon and increased risk of directional moves.

View full notes
Strategycredit spreads
Assetindex
Expirationshort-term
Time horizonshort-term
Entry / triggermarket volatility
Target / exitpremium collected
Invalidation / stopsignificant price movement
SpeakerDean
Structure / legs
  • puts
Risks
  • rapid price changes
  • time decay
  • implied volatility changes
shortindexshortCredit Spreadshort-term
medium confidenceVerify in video at 52:24 ↗
Trade idea

Trade idea Credit Spread

Buying back the short leg of an untested iron condor for 5 cents is a low-cost action that can be followed by selling a new credit spread on the same side in the same expiration. This approach avoids the complexity of managing multiple expirations and ensures that the trade remains within the same cycle, reducing margin requirements and potential confusion. The rationale is to maintain simplicity and focus on the same market conditions without introducing unnecessary complexity.

View full notes
StrategyCredit Spread
Time horizonSame expiration
Entry / triggerBuying back the short leg of an untested iron condor for 5 cents
Target / exitSell a new credit spread on the same side in the same expiration
Invalidation / stopAvoid breaking up expirations to prevent confusion with rolling and profit taking
SpeakerUnknown
Risks
  • Potential for increased margin requirements if the trade is not managed within the same cycle
  • Risk of confusion if the trade is broken up across different expirations
credit spread
high confidenceVerify in video at 52:44 ↗
Trade idea

SPCE credit spread

The speaker suggests a credit spread strategy for SpaceX (SPCE) based on its high expected move of $37. The trade involves buying 105 puts 5 times and selling 95 puts 12 times, resulting in a credit of $425-$430. The expected move is expected to take the stock down to $127, with a break-even point at $90. The trade is considered a short premium trade, and the speaker is cautious about the stock crashing. The trade is not long-term and is executed with a small position size.

View full notes
Strategycredit spread
Assetstock
ExpirationAugust 21st
Time horizonShort-term
Entry / triggerStock trading at 164
Target / exitCredit of $425-$430
Invalidation / stopStock crashing
SpeakerUnknown
Structure / legs
  • Buy 105 puts 5 times
  • Sell 95 puts 12 times
Risks
  • Stock crashing
  • The credit collected is dependent on the stock's movement
  • The trade is not long-term
shortEquityshortcredit spreadSPCEshort-term
high confidenceVerify in video at 32:37 ↗
Trade idea

NFLX credit spread

Netflix (NFLX) is a liquid stock with a history of significant price movements around earnings. Credit spreads can be used to collect premium before earnings, but the risk is that the price may move beyond the expected range, invalidating the trade. The strategy is suitable for a small account due to the limited capital required for the spread.

View full notes
Strategycredit spread
Assetequity
Expirationearnings date
Time horizonshort-term
Entry / triggerbefore earnings announcement
Target / exitpremium collected
Invalidation / stopsignificant price movement beyond expected range
SpeakerSteve
Structure / legs
  • put
  • call
Risks
  • Significant price movement beyond expected range
  • Volatility may affect the effectiveness of the spread
  • Liquidity issues if the stock is not liquid
shortequityshortcredit spreadNFLXshort-term
medium confidenceVerify in video at 57:50 ↗
Q&A

What is your opinion on buying back the short leg of an untested iron condor for 5 cents and then selling a new credit spread on that same side in a later expiration?

The speaker suggests that buying back the short leg of an untested iron condor for 5 cents is a low-cost action, but they advise against selling a new credit spread on the same side in a later expiration. Instead, they recommend selling a new credit spread on the same side in the same expiration to avoid confusion and maintain simplicity. The rationale is to keep the trade within the same cycle and reduce margin requirements.

View full notes
Actionable takeawayAvoid breaking up expirations when managing credit spreads to prevent confusion and reduce margin requirements.
Credit Spreadiron condorOptions
high confidenceVerify in video at 52:44 ↗
Q&A

Is US corporate credit spreads are near multi-year lows? Is credit market optimism the strongest validation of the equity bull case?

The speaker is skeptical about the credit market optimism being the strongest validation of the equity bull case, and mentions that it's a red flag for them.

View full notes
Actionable takeawayCredit market optimism may not be the strongest validation of the equity bull case.
Credit Spread
medium confidenceVerify in video at 1:04:08 ↗
Q&A

Would you do a credit spread or a debit spread?

The speaker prefers a credit spread in this case, as it is a risk-one-to-make-one trade. The trade is considered a pure 50/50 shot with a 29-tick spread, risking $450 to make $550.

View full notes
Actionable takeawayThe speaker prefers a credit spread when the expected move is high and the trade is a risk-one-to-make-one.
credit spreadZNrisk management
high confidenceVerify in video at 37:09 ↗
Q&A

What do you guys think with a small account? It's only about $10,000. Would you do Netflix credit spread into earnings?

A small account with $10,000 could consider a Netflix credit spread into earnings. The strategy involves buying a credit spread, which allows for collecting premium. The risk is that the price may move beyond the expected range, invalidating the trade. The speaker suggests that the trade could tie up around $7,000, depending on the strike prices chosen.

View full notes
Actionable takeawayA small account can consider a credit spread strategy for Netflix before earnings, but the risk of significant price movement should be carefully managed.
Credit SpreadNFLXOptions
medium confidenceVerify in video at 57:45 ↗