Day: August 21, 2025

The Reverse Back Spread (or Short 1x2 Ratio Spread) If the regular back spread is all about betting on big moves and volatility expansion, the reverse back spread is the opposite. It is a strategy designed for traders who expect the underlying to stay quiet and volatility to decline. What It Is A reverse back spread is essentially the mirror image of the back spread. Instead of selling 1 option...

Understanding the Back Spread (or 1x2 Ratio Volatility Spread) Options trading is full of strategies that sound like complicated recipes, but at their core they’are designed to manage risk and profit from different market conditions. One of the more interesting strategies for traders who expect a strong move in volatility is the back spread, also known as the 1x2 ratio volatility spread. What...