Bear Put Vertical – The Option Strategy Desk Reference

Bear Put Vertical

Strategy: Sell n Puts, 56 DTE

Buy n Puts Higher Strike, Same Expiry

Example:

Price Chart: Downtrending

Current IV%: 25%

IV Rank: 30%

Trade: Buy n put options; sell n put options lower strike.

Typical Strike Deltas:

Long Put 0.55 to 0.35

Short Put 0.25 (should be outside 1 standard deviation).

Goals: Strong price drop that moves long puts deeper ITM for profit; premium from OTM short puts used to reduce entry cost.

Manage: If possible, roll short calls once. Otherwise, close the trade or let it expire worthless.

Profit: Close when profit is at or more than 30 percent.

Loss: Close for an 8 percent loss.