Calendar Bull Put – The Option Strategy Desk Reference

Calendar Bull Put

Strategy: Sell n Puts, 56 DTE

Buy n Puts, Lower Strike, 1 Expiration Later

Example:

Price Chart: Uptrending

Current IV%: 60%

IV Rank: 70

Trade: Sell n put options; buy n put options, later expiration, lower strike.

Typical Strike Deltas:

Short Put 0.30

Long Put 2 to 4 strikes lower; based upon strike widths and premium

Goals: Collect premium; a rally in underlying moves both long and short puts farther OTM.

Manage: If possible, roll short puts once. Otherwise, close the trade as it approaches expiration for profit or let it expire worthless.

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

Loss: Close for an 8 percent loss.