Vertical Spreads are options strategies that involve the simultaneous purchase and sale of the same type of option, either Calls or Puts on the same underlying asset, with the same expiration date, but different strike prices.
The term “vertical” comes from selecting the desired option strike prices/positions from the same vertical column within the option chain.
A vertical spread, involves buying and selling puts, for a put spread, or buying and selling a calls, for a call spread. A vertical spread by definition requires buying/selling of the same type of options with the same expiration date but different strikes. A vertical spread can be bullish or bearish and can be either debit or credit trade.
