A Step-by-Step Guide to Buying Put Debit Spreads on thinkorswim by TD Ameritrade

How to easily enter and purchase a put vertical spread

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As Schaeffer's Investment Research is not affiliated with thinkorswim® by TD Ameritrade, this article can only provide general steps on how to buy a put debit spread on thinkorswim®. However, keep in mind that financial processes and platforms may change over time, so it's always a good idea to double-check with the latest information from thinkorswim® by TD Ameritrade or consult a financial advisor if you're unsure about any options trading strategy.

Bernie Schaeffer has recently launched two new debit spread trading programs (Vertical Options Trader and Grand Slam Countdown) in which our members can take advantage of the powerful debit spread strategy. Both programs offer call debit spreads and put debit spreads. We will discuss buying put debit spreads on thinkorswim here, but you can review how to buy call debit spreads on thinkorswim® by clicking here.

Here is how to buy a put debit spread (aka a put vertical spread) on thinkorswim®:

Step 1: Log In to Your thinkorswim® Account

If you already have a thinkorswim® account, log in. If not, sign up for a new account and complete any necessary verification processes.

Step 2: Access the Trade Tab

After logging in, click on the "Trade" tab at the top of the thinkorswim® platform to access the trading section.

Step 3: Select the Underlying Stock

In the trading section, use the search bar to find the name or symbol of the underlying stock for which you want to buy a put debit spread. Once you select the stock, its options chain will be displayed.

Step 4: Choose the Put Option for the Long Leg

Within the options chain, find the specific put option you want to use as the long leg of your put debit spread. The long leg is the put option you're buying. Click on the ask price of the put option to open a buy order ticket.

Step 5: Choose the Put Option for the Short Leg

To create a put debit spread, you'll also need to sell a put option with a lower strike price than the one you're buying. Locate the specific put option you want to use as the short leg. Click on the bid price of the put option to open a sell order ticket.

Step 6: Set the Number of Contracts

In the order tickets for both the long and short put options, specify the number of contracts you want to trade. Double-check that you're setting up a put debit spread and review all the order details.

Step 7: Place the Trade

Once you're satisfied with your selections and have reviewed all the order details, click the "Confirm and Send" button to place the put debit spread trade.

Step 8: Monitor Your Position

After placing the put debit spread trade, you can monitor it in the thinkorswim platform. Keep track of the trade's performance and be aware of any potential risks associated with options trading.

Options trading can be intricate, and buying put debit spreads involves specific risks. It's crucial to have a good understanding of options trading strategies and the risks involved before executing any trades. If you're new to options or need further guidance, consider seeking advice from a qualified financial advisor or exploring thinkorswim®'s educational resources.

Learn better through video? Here is a great video that we found on YouTube that will visually walk you through placing a put debit spread on thinkorswim® by TD Ameritrade:

SIR is not affiliated with any brokerage firm and does not endorse or recommend any specific brokerage firm. SIR is not and will not be responsible for any trades made by a broker on the subscriber's behalf under any circumstances. 


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