Bear Spread

Bear Spread (Call)

A.K.A. Bear Call Spread

investment

Opinion: Bearish to very Bearish.

Example:
Short 1 Oct 60 Call @ 5 1/8
Long 1 Oct 65 Call @ 3 1/8

Description: A Bear Call Spread is a type of Vertical Spread. It contains two Call options with different strikes. The highest strike option is the long Call. The short Call’s strike price is one of the strike prices below the long Call.

Bear Spread (Put)

A.K.A. Bear Put Spread

investment

Opinion: Bearish to very Bearish.

Example:
Short 1 Oct 60 Put @ 4 1/4
Long 1 Oct 65 Put @ 7 1/4

Description: A Bear Put Spread is a type of Vertical Spread. It contains two Put options with different strikes. The higher strike option is the long Put while the short Put is one of the strike prices below the long Put.

This strategy is equivalent to the Bear Call Spread, but is done for a debit!