Put diagonal spread

Also called: Diagonal put spread

Buy a later-expiry in-the-money put and sell a near-expiry out-of-the-money put: a bearish position that earns near-term decay.

Payoff sketch (per unit, index points)

At the near expiry

Today (7 days left)

Net premium

Debit 337 pts

Max profit

+175 pts in this range (₹11,358 per lot)

Max loss

−177 pts in this range (₹11,532 per lot)

Breakeven

25,122

Legs: Buy PE ATM +200 (far expiry) · 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 the near expiry and 35 to the far one, 6.5% interest, no skew and before charges. Rupees per lot use a NIFTY lot of 65.

How it works

The mirror of the call diagonal: the far put carries the bearish exposure, the near put is sold against it for income.

When traders use it

A slow-decline view with repeated premium collection.

Greeks

Delta	Negative.
Gamma	Mixed; negative near the short strike close to its expiry.
Theta	Usually positive.
Vega	Positive.

Profit, loss and margin

Max profit	Largest near the short strike at the near expiry.
Max loss	About the net debit plus charges, on a large rally.
Breakeven	Depends on the far put's value at the near expiry.
Margin	The short put is margined against the long far put; the offset falls away on the near leg's expiry day.

In India

Since February 2025 the calendar-spread margin offset no longer applies on the expiry day of the expiring leg, so a calendar or diagonal can need noticeably more margin on that day.
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.
STT is charged on the premium when an option is sold (0.15% of premium from 1 April 2026 in Arthfy's cost model). A short option left to expire, in or out of the money, is not charged STT again at settlement.

Arthfy numbers

Diagonals are not covered by Arthfy's single-expiry history yet.

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

Open the option chainLive premiums, IV and Greeks

Calendars & diagonals

Put calendar spread