For calendar spreads, especially on underlying assets like $SPX, do you typically leg into the trade (e.g., sell near-month, then buy far-month later) or put it on as a single order? What are the benefits/risks of each approach?
While single orders are safer, legging in allows you to be more selective about your entry points for each leg, potentially getting a better overall credit or debit. It's a trade-off between control and risk.
Good question! I've done both, but lately, I prefer to leg in if I'm trying to optimize for a specific theta decay profile. It requires more active management, though, and you have to be quick.
Never leg into an SPX calendar spread. The bid-ask on those options can move against you instantly. One order, one price, less stress.
I always put calendar spreads on as a single order. The slippage potential when legging into $SPX spreads can eat into your profits too much, especially with tighter markets. Just my two cents.
I find legging useful when I'm already in a position and want to adjust. For an initial entry, especially on a fast-moving underlying like SPX, a single order is usually the way to go to avoid unnecessary risk.