If i deploy bull put spread strategy by buying 1 OTM Put option (leg 1) selling 1 ITM Put option (leg 2) and if the market goes against my strategy my buy leg(strike) would be in profit and sell leg (strike) will be in loss.
my doubt is can i book the profit in buy leg and again hedge the sell leg
I mean the one strike which is in “profit”. example
sell banknifty 52400 pe (1 lot)
buy banknifty 52300 pe (1 lot)
and banknifty goes to 52000 , then i will in loss on 52400 pe and profit in 52300 pe strikes. my question is can close , 52300 pe and then buy 52200 pe as an hedge again
Usually when you put on a spread, it should come off as a spread unless you’re a very advanced trader.
Keep a take profit target of 50-75% of your max profit and a stoploss of 100% of your take profit target.
Definitely you can take profit from buy leg and adjust your trade of sell leg by some new postion. It is only for advance traders who understand what they are doing and what may be the implications.