spreads question

[Handle123]

I've been trading bull put spreads lately. Doing well enough, but got a beatdown today.
Trading large caps after pullbacks, mainly.
Question - Does it make sense to do a ratio trade on spreads? I like buy 5 bull put spreads, and one bear put spread (at a strike above the bull spreads). This will lower reward, of course, but will it decrease risk more, offering a more favorable R/R? Does the strategy make sense as a downside hedge?

Last four years have been adding credit spreads options to how I trade other than hedging. I don't read anywhere in your post if you using a system for entry, or directional. Just putting on bull put spreads in markets that are in uptrend, just a matter of time when you going to get tagged. Like NVDA is in uptrend, the double top signal is not like a 6 week till expiration type trade, more like 1st or 2nd deviation and get out.

Think it be better to find down trending stocks after a rally.

 

[misterkel]

Think it be better to find down trending stocks after a rally.

Huh? I suppose you mean for trading bear credit spreads?
I suppose I prefer bull put spreads because puts tend to have better structures from volatility smile and general long-term bull market. Most traders seem to prefer puts, so far as I can tell - that's the structure they usually talk about.
But stocks in longer downtrends will not change direction when the market reverses, so I've looked at shorting the upside on that.

System is after a pullback to 50 or 100 ema - K.I.S.S principle.

 

[Handle123]

Huh? I suppose you mean for trading bear credit spreads?
I suppose I prefer bull put spreads because puts tend to have better structures from volatility smile and general long-term bull market. Most traders seem to prefer puts, so far as I can tell - that's the structure they usually talk about.
But stocks in longer downtrends will not change direction when the market reverses, so I've looked at shorting the upside on that.

System is after a pullback to 50 or 100 ema - K.I.S.S principle.

Considering a bias of stocks going up 65%? of the time, I can see why traders prefer doing credit spreads on the down side. Plus, if you have well back tested method, Put credit spreads way to go. But same method gives Call credit spreads as well for me.

Glad you found what works for you all that counts.