Bear put spread
Buy a put and sell a lower-strike put for defined-risk bearish exposure.
The bear put spread is a defined-risk, bearish options strategy that involves buying a put at a higher strike and selling a put at a lower strike, both with the same expiration. You pay a net debit upfront and profit if the stock falls below your long put's strike , with maximum gain capped at the spread width.
Bias: Bearish Risk profile: Defined (debit paid) Ideal conditions: Moderate bearish view, low to moderate IV rank
How it's constructed
- Buy a put at a higher strike (ATM or slightly OTM)
- Sell a put at a lower strike (further OTM)
- Same expiration, net debit paid
The short put reduces the cost of your long put but caps the maximum profit.
Setup example
NVDA is at $120. You expect a pullback to $105 over the next 30 days.
- Buy the $115 put → pay $4.20
- Sell the $105 put → collect $1.80
- Net debit: $2.40 per share ($240 per spread)
Max profit, max loss, breakeven
| Metric | Calculation | Value |
|---|---|---|
| Max profit | Spread width − debit paid | $760 per spread |
| Max loss | Debit paid | $240 per spread |
| Breakeven | Long put strike − debit | $112.60 |
| Profit zone | NVDA below $112.60 at expiry | , |
When to use a bear put spread
Use when you're moderately bearish with a specific downside target in mind. The short put reduces cost , if your target is the short strike, the spread provides near-equivalent profit at lower cost and risk than an outright long put.
Ideal when: IV rank is low to moderate (options are reasonably priced), you have a specific downside price target, and you want reduced exposure to theta decay relative to a long put.
Avoid when: IV is very high (consider selling a bear call spread instead , collect credit rather than pay debit), or you expect a catastrophic collapse well beyond your short strike (the cap limits your gains).
Related terms: Debit spread, put option, defined risk, long put, delta, IV rank
Try it on Stryke: Screen for bearish setups with low IV rank in the Options Screener.
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