Robinhood Advanced SMALL ACCOUNT Strategy – How To Get Options CHEAPEEj8gWTXGsc_0R2UPdbNDmF&index=6

All right, ladies and gentlemen, I hope you're having a wonderful weekend. I hope you had a wonderful trading week. There's a lot of exciting stuff going on in the market and that's why I thought I'd make this video and going over a more advanced trading strategy that you could use on Robinhood and I just started employing this as we brought this account up and I recommend you guys go watch the strategy we're using. You know, this account was at 140 something bucks. You've seen it go up over time and I am gonna get into, you know, we've talked about the, you know, broader strategies and this is what's gonna help you utilize the stream and the watch list where we are going over now the types of plays to go about hunting and finding this stuff. But this strategy is great, especially in the climate because during volatility, this strategy is very useful and even when there's a lack of volatility, so kind of on both extremes, you could use this strategy and it's to get options and trade options for a cheaper price and I really want you guys to start getting used to or even just get exposed to the opportunities you have with trading options where it's not as just buying calls and selling calls. So it's a more advanced, but the best part about this, it is still relatively easy to implement if you are already trading. Now, if you are a beginner, we got the bootcamp and best of all, come on the live stream. It's in the comments, it's in the description. We're trading live Monday through Friday, 30 minutes before open. Shout out to Colt, baby. Shout out, Chad. I love you guys all. It's just been great. It's been a lot of fun. So feel free to ask questions and even here and if you guys do have any requests for videos, I would love to help you out and answer those. So give them below and everybody even in, we got everybody, thank you for even helping out and showing love to these people. It doesn't matter at any level and again, whether you are even advanced or beginner, I encourage you, that's what I've been seeing with a lot of traders recently. Keep an open mind. You could always take something and learn it and you know, really the danger with trading is that ego. There's a lot of it is mindset. So the minute you think you know something, I mean, it doesn't always hurt to review or go over something, but there's many, many options and I call it the financial trickery. You could get so creative and you guys are really in control of both the risks you're gonna take and how much you're gonna take. So we're gonna go over this and talk about some of the advantages and disadvantages of this and some of the difference, but this is spread. So you guys have probably heard credit spreads, debit spreads. I wanna go over how to do them on Robinhood, how to execute them. We recently did one here. It worked out really good and it highlighted a lot of advantages that I want you guys to see, but now as this account has grown, it's giving us more freedom, but then again, as you start to make more money, you want to protect it and this is a strategy that's gonna allow you now to go after plays without having to spend too much money and again, if you guys saw that one video, it's like we're saying, yeah, go for $20, $30 play, like even that UVXY, this one right here, the best part is this play costs 50 bucks. You could've got a cheaper one. I was playing something risky like UVXY, but this is what's gonna allow you now to play these cheaper options where I'm saying you're spending a cheap amount of options or spending a cheap amount of money, but you're not getting restricted to buy something two standard deviations out the money or a really, really low probability play. You could increase your probabilities, but that is the key with this spread. It's a give and take relationship and that's how when you start seeing the financial trickery everything just has drawbacks. You get this, you give that, you give this, you get that. So I hope you guys are ready for this. You guys know what to do. Just drop your thumbs up, show some love, make sure you subscribe. We post a nightly watch list every single night during the week and on Sunday night and that's even gonna lead to the next thing. I've posted a lot of these videos. We're going over these strategies and you guys are seeing what we're doing on the account. If you're like, I want the plays, get to that point, I want a pony, you could ask anybody here in the cult, man. We do not hold back anything. I'm not, you know, it's not hidden. Yeah, we got the stream alerts, that. Put in the time and go through the work, but that's what we're doing on stream and that's what we're covering in the watch list. So it's kind of knowing the broader strategies and then we focus in on the plays, but if you don't, you know, the plays aren't gonna help you if you don't know the various ways you could do this. That's why we could go over certain plays and now when you're exposed to 30 different ways to use options to fit your need or your desires or goals, this goes back to that analogy. I'll get you guys the ball, I'll get you the bounce pass, I'm showing you different ways to finish. So let's talk about it and let me show you. So what a spread is, and this is what I mean by how to get it cheaper, you're essentially financing an option. So now let's say you wanted to buy an option and now here's the thing too, you can't do this on mobile with Robinhood, unfortunately, but you can do it on the desktop app and I actually really enjoy the Robinhood desktop app, but let's say you wanted to buy a normal option. Let's say you wanted to buy this weekly here and again, this is how you change the timeframes on Robinhood. This is where you say buy or sell and this is gonna be important, we're gonna come to this and then this is the call and put. But let's say we were gonna buy a call and you're like, okay, I think Apple's gonna go up, but I only wanna spend $40, let's say. So you're not gonna be able to buy these, these may seem like they're a little too expensive, so then you're gonna come down and be like, oh, this is 55, this is 29 and click it and that's the thing. Usually, this is what we've been talking about, so whether you're new or advanced on Robinhood, you go continue and then right when you get to this order, this is the bid and the ask and that's usually the biggest problem people have with filling and both executing orders, buying in or selling out, because as you see, it says 29. If you use the price 29, you're not automatically gonna get filled unless the order gets filled. If you put it at 30, your odds increase, that is the ask price. But as you see, if you wanted to spend your money, if you wanted to put $40, you're like, well, this is 30 for a 215 call or you could go and then look at, as I clicked another one, it changes the options and this is what I'm gonna show you here. This is how you create the spread, but let's get rid of this one and you can see the ask. The ask is at, well, it's at 66 and the bid's at 44 and this is kind of what highlights the spread sync thing, because this is saying it's at 55. Again, if you wanted to spend 40, maybe now you could try to, this is what I call snaking the spread or snaking the bid, where there's a large spread and I'll try to put in a lower price and get it, but if you wanted to guarantee a fill here, you'll get it at 29. Here, you might have to wait and do stuff, but this is where you could get a bigger, a better deal and this is also, too, during the stream, the watch list, anything, there's a big difference between these two strike prices. If I could get this for 40 instead of spending 30 bucks here, you wanna get closer to the money. Again, the biggest mistake people have been making when it comes to these smaller accounts is if you have, and again, please listen if you have a small account, just because, let's say we bought a $50 option, you're like, I only wanna spend 15, I'm just gonna go grab this one. That's not a good strategy, because even though it has a price, it doesn't mean this is how the stock could go up and you could still lose money, so you just have to be careful of that and watch out for that. So I would try to get closer here, but again, if you did a normal option, it would be, again, let's go back to that. Let's say we wanted to spend $40. Let's say, okay, well, you can't get anything at 40. Let's say you wanna settle at this, and now that's a 215. So let's see what Apple's trading at right now, and this is gonna come up, I'm gonna talk about this play, that $40 to 1100. We're gonna discuss it, because it really relates here to this topic, but Apple right now is trading at 204.05, or 204.50, excuse me. So you're saying, I'm gonna get a 215 in a week, you think it's gonna come up about $11, and that's about 5%, 6% on Apple. That's pretty big in a week, but again, we're in a volatile market as we're making this video, but that's still kind of far at the money. But if you wanted to normally buy it, this is just buying a normal option, boom, that's it. So what a spread does, and this is the nature now of what I mean by making it cheaper and financing it, is you now are incorporating buying an option and shorting an option. So this is what people refer to as selling premium. If you guys aren't aware of that, but it's just like a stock, if you think anything is gonna go down in value, you could short it. So what that means is you're selling it, and you're agreeing to provide the back-end trade. So instead of, you know, you buy this call, someone's agreeing to sell you 100 shares of Apple at 215, instead, if you shorted it, then you would be saying you would sell them the shares at 215. Now, the first problem people have with this is that they're saying, oh, well, to sell premium, I need a large account. No, that's only if it was a naked premium, is what they'd call it, if it was uncovered. But now this is something, and I love Robinhood for it, because again, it's opening you up to the spreads, and it's letting you do it for no commission, but you just have to make sure the risk is balanced, but that's how they let you do it. So you would short a contract, and then by buying another contract, it covers your risk, and really, all you need is the difference between the strike price. So putting this into perspective now, we don't have to get this call if we wanted to spend that $40. Let's say now instead, what you can do is you could get this 215, so buy call, you could get this 210, it says $95. So again, you're like, I only wanna spend 40. That's the point. You would buy this for $95, and then you go to sell option instead. So then you click it, it'll give you the same chain, and you see this one's already collected, or selected, but now we would come down here to the 212.15, and this is going for 55, let's say, and again, I just told you the difference there on the bids, but you'll see how this comes into play. So now look it, it's giving you, and it says here, a call debit spread, and we're gonna talk about what a debit spread is, and I have the notes on here, but essentially, a debit is, think about your debit card. When you debit something, that means you're spending money. So it says 210 call, buy for $95, and then you're selling this one for 53. So even though you're shorting it pretty much to, and we're gonna talk about this, maybe I'll get to the page here, with the advantages and whatnot, but it's saying your total cost is gonna be $40. So then boom, you put contracts, you just put one contract, one shares of each, and then it's saying limit price, 22 to 55 cents. So now this is where it gets really confusing for some people, just because it's like, well, what price do you pay? It's literally just the bid and the ask. So remember, you're gonna put this order in at the same time, so it's gonna do two separate orders. You're setting a limit price for both of them. So that's the cool part, because you might buy this one for cheaper and sell this for less, or you could sell this for a lot of money and buy this cheaper, but it's saying what's the most you wanna spend on both of these total. So if you did 25, that's by selling at the bid on both of those. So that means putting in a buy order at the bid, and then trying to sell there at the ask. That would mean you're spending the least amount of possible. That's your best case scenario. But if you wanted a guaranteed fill, you could throw it at the ask and do 55 cents right there, which would mean essentially, you would be buying this at the ask and then selling this at the bid. But now, boom, $45. And then usually now, and it's saying order summary, you're buying to open, because you're purchasing, and then you're shorting this sell to open. But again, your total cost would be $55. And now the market's not open, but usually on Robinhood, it will let you know, and it'll say, do you want this to be a credit or a debit? So if you're doing a debit spread, that means you're spending the money. And usually if you're looking to profit off of this getting in the money or using the situation at hand, the debit spread means you're buying the call closer and then financing it with the cheaper call. And this is what I mean now by financing an option plan, allowing you to get options for cheaper, because now you're buying this for 95 cents, but then you could sell one of these for 55. And then think about what could happen here, actually. This is what opens you up to, it increases, there's advantages, but now let's say by Friday, let's say Apple ended at 210, or let's say even Apple ended up at 212.50 on Friday, that's where it closed. You bought this at, this is a 210 call, this would be $2.50 in the money. This would be worth $250, but then you sold this and collected, let's say 55 bucks or so. So then you would actually, this would expire worthless. And that's the point is that you could buy the price you think it's gonna go to, or if again, you wanna lower your cost basis, or if you think it's gonna get to a specific, you think it's gonna go up, but not that high enough, and you notice these contracts are expensive, you could sell these premiums. Now that's where it starts to get more and more advanced when you start trying to pinpoint what you think's gonna happen. I encourage you to just keep it simple and use this as a way to finance plays and spend the same little amount of money to get now higher quality plays. So we're gonna come back to this and I'll show you some of the mores, but now that being said, let's talk about this and what this is. Here are the advantages. It lowers your cost basis. Your cost basis is how much money you're spending. So as you see here, it's allowing you, and we said 40, but you'll end up spending 55 bucks, but at the end of the day, you're still spending a little bit amount of money. If you wanted to just buy a 210 call by itself and thought it was gonna go to 210, but you didn't think it was gonna go higher and you spent money on it, you didn't have to spend $95, and especially if you're trying to play a weekly or anything else, and then the best part is too, we're gonna talk about this, you could do this with time. That's what we did on those UVXYs till September. And I'll show you guys, I know this, you guys are gonna love this for some of you guys. You can play this on Tesla. This is part of the thing with volatility. This is how this strategy is helping you. Because those crazy, if you wanted to play a crazy stock like Tesla, the contracts are expensive, boom, you could lower the cost basis and how much you're paying by utilizing a spread. The next biggest advantage is you're getting a lower price, but for closer to the money strikes. Now you're not gonna fall victim to that same, well, I only have this much money, I'm gonna buy this super far at the money and it falls out. No, you're actually at a way, way closer price, for Apple now to move five bucks in one week, instead of 215, think about that. You bought this with that same 30, 40, 50 bucks, you're asking for a lot bigger of a move. Here, it's completely different and you're getting to play it for a lower price and a better quality strike price that is closer to the money. And now even better, just like I said with Tesla, it allows you to combat volatility or expensive prices. And this is why it's called financing here to a degree, because now let's say even in this market, the stock market's dropping, the puts are really expensive. Well, yeah, you wanted to buy one of these crappy puts, but you're like, you know, and that's the key if you guys have watched the videos, it's all about timing with options. So keep that in mind and make sure you guys are paper trading here. But now it's extremely volatile. Well, now you could kind of use it to your favor. It's like, okay, well, this is too expensive. I don't wanna buy or even let's switch to the put side. You know, Apple has been dropping a bunch here. Let's see these $200 puts for August 9th. Let's go to buy. They're going for, you know, $200 for a 200 put and that's for next week. So you're gonna spend $200 for Apple to drop that same four bucks and think about it. Now, if you spend $200 and it's at 204 right now and the strike price is at 200, you're break even by Friday. If you spent $200 on that play, if Apple isn't at like 198, you'll lose money. If it hits 198 by Friday, you'll just simply break even. But now there's volatility. Insurance and the prices went up. So take a look here. Here's the option price. See, and if you guys didn't know, this was part of our strategy here, you know, these smaller priced options, you see what they could do. Three days ago, this contract was trading at $17. Then it shot up to 199 and now it's 200. That's volatility. You know, think about that. You're gonna buy something that was trading that was very unlikely two, three days ago. Of course, some things have changed, but again, you are gonna be spending a lot. And now that it's dropped so fast, so quick, people are expecting a lot. The demand, people wanna protect their positions. People wanna profit on it. People are gonna rush into this. And now they're saying, hey, if Apple keeps dropping at this pace, look at how much it's dropped in those last few days. If this continues, that's why they're charging a lot of money now for these puts. And guess what? That is implied volatility. Remember, IV is a result, not a cause. IV is a result, not a cause. Shout out to Chad, baby. Cool, cool, cool. But that's expensive. So now this is how, if this is expensive, and you're like, okay, well, I'm gonna go now to the out of the monies. I wanna only spend 30, 40 bucks. It's the same situation. These contracts were worthless. These were the $1 bids that just weren't there. And that's what happens. If people start to get worried, even the crappier, lower quality contracts go up in value. That's why they'll go up a lot more and drop a lot more too here. But now with higher volatility, that means you could collect money on options that are most likely not gonna hit. These may work, but it's not, if you could say it's not gonna be that bad, and that's the best part about a spread, everything is capped. Your risks and your gains and everything are capped there. I think I should have, that's like if we had one of those little circular charts, that'd be in the middle. Your gains and your losses are capped depending on if you do a debit or a credit spread. But even then, it's literally always capped. You're not gonna, just like a normal option, you won't lose more than you put in, or you could lose more than you put in, but you know exactly how much you'll lose worst case scenario. But now, there's high volatility, you could do the same strategy now. So you're like, okay, well, instead of spending 50 bucks and getting a 192, and saying Apple's gonna drop $8, and then you have a 50 cent break even, and then Apple's gonna drop another 7% just for you to break even, you could do the same thing here. You could even buy the 290. You could play right at the money, and you could buy this option, you could buy the 202.50 put, and then do the same thing here, come to sell, and boom. But now, as you see here, remember, we had that other call spread up, so it says four option order. We're gonna have to get rid of that. How do we cancel all these? We need to get rid of all those. So you just come back here. So there you go. But now, this is saying 299 for 204. That makes sense. That's spending $99, because you're buying at 299. That wouldn't work. We don't want to spend that much money, but let's say if we got the 204 now, but look it, we're on sell. And remember, when it says sell, it's saying negative there, and it's saying short put. It's telling you, so always make sure you got the difference down here. So now, we're gonna buy this one, and then sell the 200, and get that right here, 47 cent cost basis, and boom, it's allowing you to play the play. Now, you even see here, there's gonna be a big spread, so you might even get paid less, or you might have to spend a little bit more, or you might get filled there right in the middle on both sides. But again, the market's closed right now, so it's harder to see. But this is gonna allow you to do it. And now, another advantage, this is relatively easy to apply. You guys are seeing this. Again, ask questions. I did this on stream. If you already know how to trade options, this isn't a far cry away from saying learning this thing. I think maybe an intermediate strategy, at best, is to call it this. This doesn't require you to do any extra approval in your account. This isn't requiring you to do anything really special or unique. It's just a matter of deciding, is this a better opportunity to do this here? So if you guys even remember those TLT plays that we made, right here, these were the August 16th. We got these, what, $8? They're at 136 bucks right now, and we've sold profits. We bought these at four cents initially. But then on my other account, I bought the other 50 of them for September for four cents, and I bought these straight up. I didn't do a spread, and I was gonna do a spread on the other ones in September because I said, well, TLT's a stock that can move up a lot, but now it's only gonna move up so much. That's why I could sell other calls that won't hit and then buy the ones that I think I'm gonna hit, and that's the key here. When you're doing the strategy now, and this is now the last thing, it makes it easier to take profits. You know your cap, and then again, that is also the first disadvantage. By doing these strategies, by doing any sort of spreads, you are limiting your gains. So that's the thing. There's the drawback. You don't get anything for free, baby, unless you in the call, and you live Monday through Friday 30 minutes before open. But by selling one of these contracts here, so as you see here, if we did that same play, you're buying the 200 put, so you own the right for someone to buy the shares from you at 200, so if it drops below 200, you make money, but then by getting, by allowing you to get this play for $47, let's say, and again, I say let's say, because that's assuming you got filled there. Remember, take the bid and the ask price into consideration with how much you're spending, but now if it does drop, you sold this, so you shorted this. By getting closer to the money, by allowing you to play this instead of having it come down here, anything now, your max gain is literally anything between here. So the difference between the strikes is 200 and 197.50 the most, so now if the stock plummeted tomorrow and dropped 50% even, the maximum amount of money you will make off this play will be $250, the difference between here, because by selling this now, if it goes below 197.50, this contract, you'll start losing more than you sold it for, even though this one will gain value, but as you see here, as long as it stays below, this contract protects this one, but that gap in between there, that's your profit. That's literally your profit margin. So that's both an advantage and disadvantage, because now your gains are limited, but the best part that makes it a true advantage, it makes it easier to take profits. You know the cap that you're going to receive. So let's say it's coming up here, and you're already up 200 bucks, or let's say you already made $175 out of 250, and it has like three days of time left, well you know it would make a lot more logical sense just take the profit. You've already made 80, 90%. It wouldn't make sense to risk that for an extra 20 bucks. It makes it a lot easier when to take your profit there. So that's one part I really, really enjoy about these spreads. It helps you, it forces your exit strategy, because there's no unlimited upside, or the ability for the contract to go crazy on there, but again, you can see how that could be disadvantage. A disadvantage, what am I saying? The next disadvantage, it's the same risk as a normal option. So at the end of the day, even though you're getting a higher probability if you want to go closer to the money, it's still the same risk. If you do a credit spread, or excuse me, if you do a debit spread, you're spending money. So your max risk is gonna be whatever you spend on it. So you're still spending that $40. So if you're wrong, you buy it too early, you're still down, you still lose, that's it. So you're still taking the same risk. So even though it's allowing you to get placed for cheaper, you're still putting out the money and deciding to spend it. The next big thing is there's also bad spreads. And I'm not saying the credit or debit spread, but literally, that's why I keep highlighting it here, and you're seeing it, the spreads could get really bad depending on the type of option that you're playing. The spreads could be bad, and if you still overpay for the spread, remember, your gain is capped. So if you get a bad fill and you do a bad price on here because it has such big spreads and it's harder to fill with, especially with a platform or a brokerage like Robinhood, you could end up spending a lot of money for a really, really small reward. And again, sometimes it wouldn't make sense. And again, going back now too, I forgot this is an advantage. By doing this strategy, it's like I even said with Tesla, but by being able to get these option prices cheaper in finance now, you could play stocks that you never thought you could really play there, the expensive ones. So here's like Tesla, these contracts are gonna be very, very expensive. And even then, let's say you wanted to go September 20 and get some time, you could now play these types of contracts that normally would have been out of your budget because you're utilizing this strategy here. And boom, now we're playing an original $260 put, even for with time and everything, it would have cost you 583. Again, you're capping your gain, but now you're in there for $130. So that's awesome, but where's the disadvantage? If you guys are new, this is what I'm saying. And again, that's why I encourage you guys, be smart with the plays you're making. If you know, you know, when you start getting into these higher price contracts, they have crazy spreads. So again, you could really screw yourself not getting the right price in there. And that I think is a big, big disadvantage, especially with Robinhood, it could easily hurt you. The next thing is it's easy to mess up on. And what I mean by that, it's easy to get the wrong contract, or you can make your gain too much if you don't, or if you end up buying or selling and doing a double. And again, Robinhood is not gonna stop you. It's assuming you know this, especially if you already have the approval on there, or you've already, most of you will. It's very easy to mess up on, and it's easy even to the last disadvantage. It's more confusing on the best time to sell sometimes, because sometimes these spreads, it makes more sense to hold them like a butterfly would be till expiration, but you don't know when is the real best time to sell. And it could be increasingly more confusing, but it's also easy to mess up on if you only sell one leg and your account lets you do it. So you gotta be careful for that. So that's the advantages and disadvantages. And now to give the final rundown here, a credit spread versus a debit spread. And you'll even see, you see call debit spread. If it says total cost, it's a debit spread. You're debiting your money. And here's the key to understand with that, a credit, let's go here, debit. A debit means you spend money to acquire and your max risk is on the front end. So again, we know what's happening here. You buy the 265 call, you buy the 260 call for 583, and then you short the 265. Your max gain is gonna be the, your max gain is $500, the difference between these two. And it's a debit spread because you're spending 138. You're buying this for 583, and you're selling this for cheaper because you're looking to make money on it going up. That's what that is implying. So you're still spending your money and it's a credit. And it's a debit spread because you were debiting the account. So let's get rid of these bad boys. And let's say we wanted to do the reverse now. Let's say you wanted to do that same play. And again, you have to understand why would someone do a credit spread? It's usually if you think the option is too high and you think the stock now is too expensive, or again, a play like Tesla, where some of these bigger companies, the spreads just go crazy. And even now, even for a small account, some of these out-of-the-money options, you could still get like 50 bucks, 10 bucks, and collect credit on these plays. And they're still just gonna be super far out. And again, this is now more selling premium versus buying. And the odds actually very, very increase in your favor. But then this is the next thing you gotta realize. If you do a credit spread, that means you collect the money up front and you make money pretty much off of the contract not hitting and expiring worthless, and you're buying the other contract to protect yourself. But the point is when you do a credit spread, you're usually taking the risk on the back end. So if you collect money up front, you're pledging to take the risk on the back end. By putting the money up front and doing a debit, you're already putting your money up. You know what your max gain is, that's it. Nothing else is gonna happen by expiration here. So let's reverse it here now. There's that 260. We put sell the call option. So it says sell. You're gonna collect, see it says total credit 583 if you just shorted that on your own. And again, if you try to short that on your own, understand this is, if you did just short this by itself, short call, that's what it's saying. And you try to sell one, you're like, okay, I'll sell it at 573. You would get to collect $573. If by September 20th, Tesla is below 260, or even then since you're collecting 570, if it stays below 265.73, you wouldn't lose any money. But now here it's saying, you don't have enough shares of Tesla as collateral needed. You would need a lot of money to do that play, but this is a 90% probability play. Cause again, most options expire worthless. So you're shorting them. But now this is where our good old credit spread comes into play. So now you shorted this one, but now instead of shorting that, let's go back up here and then you would buy this one now. So let's go back and now it's saying call credit spread. So you notice the difference when we're shorting the first one and buying the other one versus buying the other one and shorting the one below it. So now it's saying you would short that one, collect that money, but then we're buying this one. So think about it. You didn't have enough collateral the first time because you need to own the shares. Cause if it shot up past 265, you would lose anything past 265. If you just shorted this call, you would lose a hundred dollars for every dollar went up. And again, you only have like 500 bucks, a thousand bucks in your account. And then be like, nah, bro, it's not, we're not down with that. But now by buying the 265, this is your insurance. You're shorting this one and then you're buying insurance $5 above. So again, even if it did shoot up past 265, by you buying this 265 now, even if it goes past 265, this one's going to now start making money, even though you're lost losing on this one, but the max you'll lose is that $5 difference. So again, your gain, you know exactly what's happening and what your gain is going to be. And think about even the title about how to get options cheaper here. What this is allowing you to do is by the minute you execute this trade, you're collecting 583. So I only have 574 bucks in my account. And that's the thing to execute this trade, to know how much money will you need to do a spread of any sort. A debit spread, you don't need, it doesn't matter how much money's in your account, as long as you could afford the debit because you're paying up front, you're putting the risk up there, that's it. But a credit spread, you can't do every trade. All you could do is whatever you have cash available to cover the play. It's literally a synthetic covered call. You're buying a synthetic option to a degree. But even though I only have 573, the concept here is this, I'm selling this one, I'm collecting that 583 up front. And then right when I'm collecting that, I'm using that part of that cash to buy this one. So you made more money on this, then you buy the insurance. And then the difference you're left with is a credit of an additional 138. So literally, the $138 gets credited to your account, hence the name credit spread. But now all you have to do is you wait till expiration. If it goes till expiration, or even after a few days, there's a big drop, you could gain on it and still close out. You go to continue and boom. If we wanted to do this one, 573 again, see, that was from the last trade, but it's showing you the bid ask. So we could say now, you're trying to get minimum credit. So again, now, if you put 180 credit, it's reversed now on the credit spread. You're not buying it. So if you wanna get filled right away, you're saying, oh, I want $180 minimum credit to do this. That means you won't get filled right away. But if you said 95, if you're willing to take less money, now you'll most likely get filled right away or you'll collect more. But as it's saying, you're gonna walk away with $95, review order, boom, order summary. And again, it'll usually verify, do you want this to be a credit or debit and understand the nature there? Because if you try to do this trade and you said debit, it wouldn't make sense for you to debit money out of your account when you could be collecting it and vice versa if you were doing the other one. But as it's saying, collateral $500, that's all you need. We have 500 in the account, boom, they're gonna let us do it. So that's that. And really the final part is like I was saying in a trade like this UVXY, we bought this at 51. It went up and again, it dropped there at close with how the market was. Because again, it's volatile, but at one point it was worth $115, $14. So how do you make money on these trades? The best time is usually by holding till expiration or again, if it gets near your max gain. But if you make one of those plays and you've already made a good amount of money, like again, when this was at a dollar, we would have been up 100%. What does that mean? And this is what we did. I bought a 43 call for $1.77. Well, I didn't spend that much actually at the time. I bought it for $1.26 and now it's at $1.77. But you see at one point it went up to three bucks. That's how you make money because even though you shorted this one, this one's $10 closer to the money. And that's the thing, I spent 50 bucks on this play and my max gain would be $1,000. Let's say by September, it truly did, you know, the UVXY shot up. I would make a thousand bucks at anything above 53. But what could happen even as we saw with the UVXY, it started to go up. So even though this contract will gain in value and we lose money on this one because we sold it, this one closer to the money and substantially closer is gonna gain at a faster pace. So you're making money off of this spread between the two. So that's pretty much it. It's kind of really long in there. So hopefully, I didn't think it would be that long, but I think this is gonna give you guys a good strategy video and explain some of these sides and you could learn a lot through it. So let me know what you think and get ready for the watch list and on stream and you're gonna see how we use this. I love you all. I'm gonna see you tomorrow for the watch list. I'm gonna see you on Monday. We got another exciting week and we got another week after that and another week after that and another one. And make sure you guys check out all the other Robin Hood videos and everything else we got here. I love y'all. Shout out to Coach, shout out to Chad, baby. Let's go!