Bull Put Spreads for Beginners - Options Learning Center
Welcome to the Options Learning Center, where we will explore a wide range of topics and ideas related to options trading. This video will explain bull put spreads!
The bull put spread is a short put option strategy where you expect the underlying security to increase in value. The bull put option strategy involves selling a put option around the price of the underlying security and buying a put option at a lower strike price.
Maximum profit is the difference between the premium received for the short put and the premium paid for the long put (Net Credit). Maximum loss is the difference in strike values minus the Net Credit, which will occur if the underlying security price is below the lower strike price at expiration. The bull put strategy succeeds if the security price is above breakeven (higher strike - Net Credit). Maximum profit is achieved if the security price is above the higher strike price at expiration.
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