Option Strategy

Bear Spread - Option Strategy

Bear Spread is a strategy achieved by combining two options of the same type, by buying an option at one strike price and selling another option at a lower strike price. This strategy may be achieved using either CALL or PUT options.

This is a limited profit / limited loss strategy, which works well in case the underlying is expected to fall moderately. This type of strategy helps to reduce the premium cost of a naked option.

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