What is a ratio spread and how do I build one in the platform?
A ratio spread involves buying and selling different quantities of options at different strikes. For example, buying 1 lot of a 22,500 CE and selling 2 lots of a 22,700 CE. This creates a structure with limited or zero upfront cost but introduces unlimited risk beyond the short strike zone.
The platform includes Call Ratio Back Spread and Put Ratio Back Spread in the Readymade library. For custom ratios, use the Strategy Builder: add the long leg, then add the short leg and adjust quantities. The payoff chart will immediately show the asymmetric structure and where risk is unbounded.
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