Some spreads are used because they maximize dollar return. Others because they provide strong risk protection. Others still are used because they can perform in the most varied kinds of market conditions. Few do all of these things exceptionally well.
One does, however. It’s called the ratio credit spread.
The ratio credit spread or simply the “ratio spread” has become my bread-and-butter spread for all of the reasons mentioned above. In this chapter, you will learn why. You will also learn how you can use this strategy to build an option-selling portfolio that can generate small or large amounts of cash for you in most any market condition.
The ratio spread (or ratio credit spread) ...