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Bear Put Spread

  • Bearish strategy
  • Buy 1 put, sell a lower strike put. Example buy 50 strike put, sell 40 strike put
  • Opposite of the Bull put spread
  • You pay a debit
  • Profit if stock goes down
  • Similar to buying a put but with a limited profit potential upto that short put(No additional profit below 40 strike, as both puts cancel each other after that point)

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