Income strategies › Credit spreads (put & call)
Stop 5 of 7 on the CC Line
Credit spreads (put & call) selling with a safety net
Sell one option, buy a cheaper one further out. Smaller premium, but your max loss is capped. Risk: Moderate (defined)
How it works
A credit spread is a short option plus a long option of the same type and expiry, further out-of-the-money. The long option is your safety net: it caps how much you can lose.
- Bull put spread (mildly bullish): sell a put, buy a lower-strike put.
- Bear call spread (mildly bearish): sell a call, buy a higher-strike call.
You collect a net credit up front. Max profit = the credit. Max loss = width between strikes − credit.
When it earns
When the stock stays on the right side of your short strike until expiry. Needs much less capital than a cash-secured put.
What can go wrong
- Max loss is usually bigger than max gain (in our example $400 risk for $100 reward).
- Two legs = double the per-contract fees, which hurts a lot when the credit is small (see table).
- Early assignment of the short leg can leave you with shares or a short stock position until you close or exercise the long leg.
- Pin risk if the stock ends right between your strikes at expiry.
Worked example Hypothetical
Fictional XYZ at $50. Bull put spread: sell the $45 put for $1.50, buy the $40 put for $0.50: net credit $1.00 (= $100). Bear call spread: sell the $55 call for $1.50, buy the $60 call for $0.50: net credit $100. Made-up premiums.
| Scenario (hypothetical) | Outcome |
|---|---|
| Put spread, XYZ ends above $45 | Keep $100 (max) |
| Put spread, XYZ ends below $40 | −$500 + $100 = −$400 (max loss) |
| Put spread breakeven | $44 |
| Call spread breakeven / max loss | $56 / −$400 if XYZ ends above $60 |
How fees eat into the premium
Using each broker's published fees from our own data (verified 2026-10-25): the cost to open this example (2 contracts in one order) next to the hypothetical $100 credit, and the same trade if the premium were a tiny $0.10 per share. Holding to expiry avoids a closing order; closing early roughly doubles the fees.
Includes commission, platform fee, per-order minimums, estimated US regulatory fees and 9% GST; excludes FX and exchange fees. "Promo" means open-ended promos available to everyone (no new-customer offers). Try your own numbers in the fee calculator →
Where to find sell-put ideas
We don't publish option prices or trade ideas. Several Singapore brokers have built-in screeners inside their apps that filter options by strike, expiry, premium or probability, using live data you're licensed to see as their customer:
- moomoo SG: Its app has an options screening tool marketed as Easy Sell Put, plus a general options screener and strategy builder. moomoo SG (placeholder referral link) · fees
- Tiger Brokers SG: The Tiger Trade app has an options screener / strategy tools for filtering contracts. Tiger Brokers SG (placeholder referral link) · fees
- Webull SG: Webull's app includes an options screener and a strategy builder. Webull SG (placeholder referral link) · fees
- Interactive Brokers SG: IBKR's platforms include market scanners and options strategy tools (e.g. in TWS). Interactive Brokers SG (placeholder referral link) · fees
Feature names and availability change and may depend on your account's options approval level; check in the app. A screener result is not a recommendation. ⚠ Referral links above are placeholders (not live); if they become affiliate links we may earn a fee at no cost to you (disclosure).
The CC Line
Seven option income strategies, drawn as a train line. Board at CC1: each stop builds on the ones before it. Interchange stops combine earlier ones.