COVERED PUT	BEAR PUT SPREAD
About Strategy	Covered Put Option Strategy  This strategy is exactly opposite to Covered Call Strategy. Here the investor is neutral or moderately bearish in nature and wants to take advantage of the price fall in the near future. The trader will short one lot of stock future. Now the trader will short ATM Put Option, the option strike price will be his exit price. If the prices rally above the strike price, the Read more..	Bear Put Spread Option Strategy  When a trader is moderately bearish on the market he can implement this strategy. Bear-Put-Spread involves buying of ITM Put Option and selling of an OTM Put Option. If prices fall, the ITM Put option starts making profits and the OTM Put option also adds to profit at a certain extent if the expiry price stays above the OTM strike. However, if it falls below the OTM .. Read more..

COVERED PUT Vs BEAR PUT SPREAD - Details

	COVERED PUT	BEAR PUT SPREAD
Market View	Bearish	Bearish
Type (CE/PE)	PE (Put Option) + Underlying	PE (Put Option)
Number Of Positions	2	2
Strategy Level	Advance	Advance
Reward Profile	Limited	Limited
Risk Profile	Unlimited	Limited
Breakeven Point	Futures Price + Premium Received	Strike Price of Long Put - Net Premium

COVERED PUT Vs BEAR PUT SPREAD - When & How to use ?

	COVERED PUT	BEAR PUT SPREAD
Market View	Bearish	Bearish
When to use?	The Covered Put works well when the market is moderately Bearish.	The bear call spread options strategy is used when you are bearish in market view. The strategy minimizes your risk in the event of prime movements going against your expectations.
Action	Sell Underlying Sell OTM Put Option	Buy ITM Put Option, Sell OTM Put Option
Breakeven Point	Futures Price + Premium Received	Strike Price of Long Put - Net Premium

COVERED PUT Vs BEAR PUT SPREAD - Risk & Reward

	COVERED PUT	BEAR PUT SPREAD
Maximum Profit Scenario	The profit happens when the price of the underlying moves above strike price of Short Put.	Max Profit = Strike Price of Long Put - Strike Price of Short Put - Net Premium Paid.
Maximum Loss Scenario	Price of Underlying - Sale Price of Underlying - Premium Received	Max Loss = Net Premium Paid.
Risk	Unlimited	Limited
Reward	Limited	Limited

COVERED PUT Vs BEAR PUT SPREAD - Strategy Pros & Cons

	COVERED PUT	BEAR PUT SPREAD
Similar Strategies	Bear Put Spread, Bear Call Spread	Bear Call Spread, Bull Call Spread
Disadvantage	• Limited profit, unlimited risk. • Trader should have enough experience before using this strategy.	• Limited profit. • Early assignment risk.
Advantages	• Investors can book profit when underlying stock price drop, move sideways or rises by a small amount. • Able to generate monthly income. • Able to generate profit from fall in prices or mild increase in the prices.	• If the strike price, expiration date or underlying stocks are rightly chosen then risk of losses would be limited to the net premium paid. • This strategy works well in declining markets. • Limited risk.