karennma
8,057 posts
msg #123188
- Ignore karennma |
3/13/2015 12:50:38 PM
Hypothetical:
If I want to do a bearish call spread and I want to sell a call and buy a call, when I SELL the call, am I selling at the bid or ask price?
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karennma
8,057 posts
msg #123190
- Ignore karennma |
3/13/2015 2:04:48 PM
Bid price. Correct?
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dashover
224 posts
msg #123193
- Ignore dashover |
3/13/2015 2:11:17 PM
Sell the Bid, Buy the Ask...
But try and work the trade so you get a bit better price than the bid, Never a market order as they will take advantage of you...
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BarTune1
441 posts
msg #123197
- Ignore BarTune1 |
3/13/2015 7:20:07 PM
Split the bid ask on both; subtract the result from the higher strike call from the lower strike call; then direct your broker to enter a combination for a credit spread of at least the difference calculated above.
If the options are not liquid they will have a wide bid ask spread and it will be difficult to fill your trade.
Bear spreads using puts or calls, or any option trading for that matter, can be rather inefficient unless you are using options with higher volumes and/or tight bid-ask spreads. It is usually much better to short the particular stock.
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