Vertical spreads

Moderately bearish

Debit

Risk: Defined both ways

Bear put spread

Also called: Debit put spread, Put debit spread

Buy a put and sell a lower-strike put on the same expiry: a cheaper bearish position with the gain capped at the strike gap.

Payoff sketch (per unit, index points)

At expiry

Today (7 days left)

Net premium

Debit 78 pts

Max profit

+122 pts (₹7,943 per lot)

Max loss

−78 pts (₹5,057 per lot)

Breakeven

24,922

Legs: Buy PE ATM · Sell PE ATM −200. Illustration, not live prices: an index at 25,000, strikes 100 points apart, Black-Scholes premiums at 13% implied volatility, 7 days to expiry, 6.5% interest, no skew and before charges. Rupees per lot use a NIFTY lot of 65.

How it works

The put sold finances part of the put bought; below the lower strike the two puts move together and the gain stops growing.

Because index puts are priced with a skew, the sold lower put often recovers a useful share of the cost.

When traders use it

A bearish view with a target near the lower strike.
A cheaper hedge than an outright put for a fall of limited size.

Greeks

Delta	Negative, smaller than a single put's.
Gamma	Positive near the upper (bought) strike, negative near the lower one.
Theta	Negative while the price is above the middle of the spread, positive below it.
Vega	Small.

Profit, loss and margin

Max profit	(Strike gap − net debit) × quantity, when the underlying settles at or below the lower strike.
Max loss	The net debit plus charges, when it settles at or above the upper strike.
Breakeven	Upper strike − net debit.
Margin	Little beyond the debit once the long put is in.

In India

SPAN margins the whole position, so a defined-risk spread usually blocks far less than its short leg alone. Brokers grant the hedge benefit only when the protective leg is actually in the account, which is why the long leg is usually placed first.
A long option that finishes in the money is exercised automatically. STT is then charged on its intrinsic value at the exercise rate (0.15% from 1 April 2026 in Arthfy's cost model), instead of the sale rate on the premium (also 0.15%) that applies when the option is sold before the close. See the lesson on the STT exercise trap.
Since 20 November 2024 each exchange keeps one weekly index expiry: NIFTY on NSE and SENSEX on BSE. Since September 2025 NSE contracts expire on Tuesdays and BSE contracts on Thursdays. BANKNIFTY, FINNIFTY, MIDCPNIFTY and stock options expire monthly (NSE on the last Tuesday). A holiday moves the expiry to the previous trading day.

Arthfy numbers

Bear put spread: what it did since 2016

Bear put spread, at the money, wing 2 strikes beyond, entered 8-15 days before expiry.

0-2 d

3-7 d

8-15 d

16-30 d

31-45 d

Try it in the F&O hub

Opens the tool with this structure on today's NIFTY chain. Reading is free with an Arthfy account; some runs use free attempts.

Open in the builderPayoff, Greeks, scenario grid and charges on today's NIFTY chain

Backtest since 2016Daily data, every NIFTY expiry

Replay on expiry daysMinute data since October 2024

Open the option chainLive premiums, IV and Greeks

Single options

Long put