Call Spread Adjustments

This the first call spread adjustment you should make to reduce your overall risk in the trade.
Call Spread Adjustments
Kirk Du Plessis
Apr 19, 2021

Making adjustments on a credit call spread starts with adding the additional put side to the trade should the stock continue to rally higher against your position. Our own trigger for making this adjustment is when the short call strike gets to a 0.30 delta. Adding a put spread below the market, if you keep the same number of contracts and width of strikes you'll reduce your overall risk and increase your credit in the trade which widens your break-even points.

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Put Spread Adjustments
This the first put spread adjustment you should make to reduce your overall risk in the trade.

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