Options
Short Put Spread Explained (High Probability Trade)
Date: 2026-06-21 11:45:12
Key insight:
When you buy options, you need a move.
When you sell options, you don’t need a big move.
Example on NVDA (around $224.60):
We sell the $210 put and buy the $207.50 put for protection.
That brings in about $0.25–$0.34 (≈ $30 credit per spread) — that’s the max profit.
For this trade to work, NVDA needs to stay above $210.
Breakeven is around $209.70.
Above $210 → keep full profit
Below $210 → start losing
Below $207.50 → max loss
Max profit ≈ $30
Max loss ≈ $220
Probability of profit ≈ 86%
Delta ≈ -12 (low chance it reaches that level)
We’re not saying NVDA is going up — we’re saying it probably won’t drop that far.
#optionstrading #SellOptions #PutSpread #creditspreads #tradingeducation
Want to get updates when we publish new videos? Click here to Subscribe: https://www.youtube.com/OptionAlpha?sub_confirmation=1
This video is for educational purposes only and is not a recommendation for buying/selling any security. Options trading is risky, so please read our full risk disclosure here: https://optionalpha.com/legal/risk-disclosure-agreement
