How to Sell Vertical Spread Option TD Ameritrade

[OptionsOptionsOptions]

Leg risk is when you are opening/closing a spread,and instead of sending out a spread order,you choose to buy/sell one side of the spread and then trade the other.Its called "legging" the spread,or you lifted a leg.Problem is,best case scenario you MAY get filled mid market,but if you lift a leg(close one side) and the market suddenly moves against you,you get smashed...

You are grasping at straws.

• You MAY getting filled at mid-market in any situation - or you MAY not.
  
• The market might move against you during the 15 seconds it take you to place your 2nd order - or it might move in your direction. You will not get "smashed".

 

[taowave]

Amateur act

You know not of what you speak..

Leg away

You are grasping at straws.

• You MAY getting filled at mid-market in any situation - or you MAY not.
  
• The market might move against you during the 15 seconds it take you to place your 2nd order - or it might move in your direction. You will not get "smashed".

 

[JSOP]

What is leg risk?

One leg getting executed while the other leg still remains outstanding while the price of the leg that's still not closed moves against you

 

[OptionsOptionsOptions]

One leg getting executed while the other leg still remains outstanding while the price of the leg that's still not closed moves against you

Yes .... @taowave posted that.

 

[.sigma]

What is leg risk?

dude cmon lol

 

[taowave]

Right???? And I am the one grasping at straws

dude cmon lol

 

[OptionsOptionsOptions]

What is leg risk?

dude cmon lol

• I have never heard that term before.
• And now that it has been defined I still do not consider it to be a risk at all. "leg risk" is a moot point.

Just because a spread isn't filled simultaneously doesn't mean the 2nd leg will be filled at a worst price - it could just as easily be filled at a better price.

 

[taowave]

You do realize you are giving advice to a newbie.

Why on earth would you recommend legging a spread.Bare minimum,if you are hell bent on legging,enter a spread order mid market first..

You clearly aren't trading stocks like TSLA in decent size..

More to the point,when a newbie,intermediate,idiot trader gets legged,the payoff is asymmetrical,and not favorably..