Bear Put Spread
Moderately bearish
Buy a put, sell a further OTM put against it — the bearish mirror of a bull call spread.
Payoff at expiry
Illustrative · NIFTY @ 25000Max Profit
₹375
Max Loss
₹7,125
Breakeven
24905
How it's built
Buy one ATM put and sell one put two strikes lower, same expiry, same lot — the short put funds part of the long put's premium.
When to deploy it
A moderate down move is your view, not a crash. You give up profit below the short strike in exchange for a materially cheaper entry than a naked put, with defined risk on both sides.
Worked example
Say NIFTY is trading around 25,000 with a few sessions left before expiry. You buy the 25000 put for ₹150, and you sell the 24900 put for ₹55 — a net debit of ₹7,125 for one lot of 75.
At expiry, the position is worth the most once NIFTY is on the right side of 24905 — up to ₹375 per lot. Move against that line instead and the worst case is capped at ₹7,125 per lot, not open-ended.
Mistakes that break this strategy
- Picking a short strike too far below spot, which barely lowers the premium paid.
- Ignoring that the short put still carries real mark-to-market risk — it's not a free lower leg.
- Forgetting this caps gains exactly where a genuine crash would have paid the most on a naked put.
More bearish strategies
See it read live, not just diagrammed
Quantum Horizon reads Aegis/Zenith wall migration and RRG rotation live across NIFTY, BANKNIFTY, FINNIFTY and MIDCPNIFTY — sign in and watch it work in Paper mode.