Bull Put Spread (Credit)
In plain English
Get paid now for betting a price will NOT fall much. You sell a put and buy a lower one for protection. You keep the cash if the price stays up; your loss is capped if it falls.
How it's built
Sell a put and buy a lower put — collect a credit, profit if the price stays up.
Illustrative payoff at expiry on a NIFTY-like underlying (spot 24,000, 7d, 13% IV). The shape is the point — open it in the Strategy Lab to tune spot, time and volatility live.
Max profit₹3,541
Max loss₹6,209
Net premiumCr ₹3,541
Breakevens23,896
When to use it
Neutral-to-bullish, want positive theta with defined risk. Good when IV is high.
Max profit
The net credit received.
Max loss
Limited to (spread width − net credit).
Common mistakes
- Selling spreads when IV is low (poor credit).
- Ignoring assignment risk near expiry.