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R Multiple for Credit Spreads
Stock Market Options Trading
How Much Can I Lose on a Credit Spread?
We're going to ignore the stop for now, and we're just going to use that protective put as our stop loss. So if i sell a five point white credit spread on s p x and receive a two dollar credit, my max gain on that trade is going to be dollars. The goal is to keep as much of that credit as possible. In most cases, you're not going to be able to achieve two or gains in most cases when you are an option seller. Think it's really more about managing winners than managing risk.
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