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Credit Spreads

The debit spread's mirror image: sell the nearer option and buy a further one for protection, taking in a net credit. A defined-risk way to profit from time decay and a stock staying away from your strike. Bull put and bear call spreads, the payoff maths, and the probability trade-off.

15 min readPublished 25 June 2026

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What Is A Debit Spread?The Option Greeks: Theta & Time Decay

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DeltaGammaThetaVolatility

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What Is A Debit Spread?

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The Iron Condor

A four-legged, defined-risk, market-neutral strategy: sell an out-of-the-money put spread and an out-of-the-money call spread to collect a credit and profit if the stock stays in a range. The payoff plateau, the high-probability trade-off, and how time decay pays you for stillness.

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