Bull Put Spread
Outlook: Neutral
Vertical spreads
Short higher-strike put, long lower-strike put. Neutral-to-bullish, credit, theta-positive.
Max profit
Credit collected.
Max loss
(Strike width) - credit.
Breakeven
Short strike - credit.
Legs
Long
1×
put
ATM −10
Short
1×
put
ATM −5
Structure
Short 1 put at higher strike + long 1 put at lower strike, same expiration.
When to use
IV rank above 30, neutral-to-bullish view. Income trade with bounded risk.
Example
SPY at $450. Short 445 put $4, long 440 put $2. Credit $2. Max profit $2, max loss $3, breakeven $443.
Notes
- Risk is 1.5x reward typically. Probability of profit is roughly 1 minus the short delta.
Build it in the simulator
Open this structure in the app, adjust spot, IV, and DTE, and watch the payoff and Greeks move.
Get the appRelated strategies
Bull Call Spread
Long lower-strike call, short higher-strike call. Bullish, defined risk, defined reward, debit.
Bear Put Spread
Long higher-strike put, short lower-strike put. Bearish, defined risk, debit.
Bear Call Spread
Short lower-strike call, long higher-strike call. Neutral-to-bearish, credit, theta-positive.