Bear Put Spread Calculator

Vertical SpreadsbearishDefined Risk

Buy a higher-strike put and sell a lower-strike put for a bearish position with defined risk.

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What Is a Bear Put Spread?

A bear put spread is a two-leg debit spread that expresses a moderately bearish view with a fixed, known cost. You buy a put at a higher strike, typically at or near the money, and sell a put at a lower strike on the same underlying and expiration. The short put's premium offsets part of the long put's cost, so the position is opened for a net debit that is smaller than buying the put alone.

The trade profits as the stock falls toward and below the short strike. Above the long strike both puts expire worthless and you lose the debit. Between the strikes the long put gains value dollar for dollar while the short put is still out of the money. Below the short strike both puts are in the money and move together, so the spread reaches its maximum value, equal to the strike width, and stops gaining.

The payoff diagram is a flat floor at the net debit above the long strike, a rising diagonal as the stock falls between the strikes, and a flat ceiling below the short strike. Selling the lower put caps the profit, but it lowers the cost, raises the breakeven closer to the current price, and reduces exposure to time decay and falling implied volatility compared with a single long put.

Setup

BUY1x ATM PUT

SELL1x OTM2 PUT

Max Profit

Strike width - net debit

Max Loss

Net debit paid

Breakeven

Higher strike - net debit

Bear Put Spread Example

XYZ trades at $100 with 45 days to expiration. You buy the $100 put for $4.00 and sell the $90 put for $1.20. The net debit is $2.80 per share, or $280 per spread. The strikes are $10 apart, so the spread can be worth at most $10.00, or $1,000.

Stock at expiration	Result
$105	Both puts expire worthless. You lose the entire $280 debit, the maximum loss.
$97.20	Breakeven. The $100 put is worth $2.80, which exactly offsets the debit. P&L is $0.
$94	The $100 put is worth $6.00 and the $90 put is still worthless. The spread is worth $600, minus the $280 debit, for a profit of $320.
$85	The $100 put is worth $15.00 and the $90 put costs $5.00 to cover, so the spread is worth its full $10.00 width. Profit is $1,000 minus $280, or $720, the maximum.

Maximum profit is $720 ($1,000 spread width minus $280 debit) if XYZ finishes at or below $90. Maximum loss is the $280 debit if it finishes at or above $100. Breakeven is $97.20, and the trade returns about 2.6 times the amount risked at its best.

When to Use a Bear Put Spread

You expect a moderate decline in the stock over the next one to three months, with a specific downside target rather than a crash.
You want to hedge a long stock position against a pullback more cheaply than a protective put, accepting that the protection stops at the short strike.
Implied volatility is average to high. A long put alone loses value when volatility falls, but the short put offsets much of that exposure.
You want bearish exposure without the unlimited risk and margin of shorting stock or the uncapped loss of a naked call.
Typical entries use 30 to 60 days to expiration with the long put at or slightly in the money and the short put 5 to 10 percent below the current price, near a support level or price target.

Risks to Understand

The stock must fall for you to profit. If it grinds sideways, time decay erodes the long put faster than the short put and the spread loses value.
Profit is capped at the short strike. In a crash the spread earns no more than its width, while a single long put would keep gaining.
Debit spreads reach full value slowly. Even with the stock below both strikes, the spread may trade below its width until the last days because the short put retains time value.
If the short put finishes in the money while the long put does not, or it is assigned early, you can be forced to buy 100 shares and must exercise the long put or sell stock to flatten.
Wide bid-ask spreads on two legs reduce a profit that is already limited to a few dollars per share, especially on illiquid underlyings or far-out expirations.

Managing the Trade

Many traders close once the spread has captured 50 to 75 percent of its maximum value, since squeezing out the final dollars often means weeks of added exposure.
If the stock drops quickly and early, consider rolling the short put down to a lower strike for more room to profit, accepting a larger total debit.
If the stock rises but the bearish thesis is intact, rolling the whole spread to a later expiration keeps the trade alive, usually at an additional cost.
Set a loss limit in advance, often 50 percent of the debit, so a losing spread is exited rather than held until it goes to zero.
Close or roll before expiration if the stock is near either strike. One leg being assigned while the other expires worthless creates an unwanted stock position over the weekend.

Bear Put Spread FAQs

How do you calculate bear put spread max profit and max loss?: Maximum loss is the net debit paid, multiplied by 100 per contract. Maximum profit is the difference between the strikes minus the net debit, also multiplied by 100. Buying a $100 put and selling a $90 put for $2.80 gives a max loss of $280 and a max profit of $720.
Where is the breakeven on a bear put spread?: Breakeven is the long put strike minus the net debit. In the example that is $100 minus $2.80, or $97.20. Below that price at expiration the trade is profitable, and the gain grows until the stock reaches the short strike.
Bear put spread vs long put: which is better?: A long put has a larger potential payoff if the stock collapses but costs more, breaks even further away, and loses more to time decay and falling volatility. A bear put spread costs less and breaks even closer to the current price but caps the profit at the short strike. For a modest decline to a target the spread usually offers a better return on risk; for a crash scenario the long put wins.
Bear put spread vs bear call spread: what is the difference?: Both are bearish vertical spreads with the same shaped payoff. The bear put spread is a debit spread that needs the stock to fall past its breakeven. The bear call spread is a credit spread that profits if the stock simply stays below the short call. Traders favor the call credit spread when implied volatility is high and the put debit spread when volatility is low and they have conviction on direction.
Can you use a bear put spread to hedge a stock position?: Yes. One spread hedges 100 shares against a decline between the two strikes at a fraction of the cost of a protective put. The limitation is that protection stops at the short strike, so a fall beyond it is not covered. It works well as insurance against a moderate pullback rather than a catastrophe.
What happens if a bear put spread expires in the money?: If the stock is below both strikes, the long put is exercised and the short put is assigned, which net to zero shares and a cash gain equal to the strike width. If the stock finishes between the strikes, only the long put is exercised and you would be short 100 shares, so most traders close the spread on the final day rather than let it settle.

Related Strategies

Bull Put Spread Bear Call Spread Long Put

What Is a Bear Put Spread?

Bear Put Spread Example

Stock at expiration	Result
$105	Both puts expire worthless. You lose the entire $280 debit, the maximum loss.
$97.20	Breakeven. The $100 put is worth $2.80, which exactly offsets the debit. P&L is $0.
$94	The $100 put is worth $6.00 and the $90 put is still worthless. The spread is worth $600, minus the $280 debit, for a profit of $320.
$85	The $100 put is worth $15.00 and the $90 put costs $5.00 to cover, so the spread is worth its full $10.00 width. Profit is $1,000 minus $280, or $720, the maximum.

When to Use a Bear Put Spread

You expect a moderate decline in the stock over the next one to three months, with a specific downside target rather than a crash.

You want to hedge a long stock position against a pullback more cheaply than a protective put, accepting that the protection stops at the short strike.

Implied volatility is average to high. A long put alone loses value when volatility falls, but the short put offsets much of that exposure.

You want bearish exposure without the unlimited risk and margin of shorting stock or the uncapped loss of a naked call.

Typical entries use 30 to 60 days to expiration with the long put at or slightly in the money and the short put 5 to 10 percent below the current price, near a support level or price target.

Risks to Understand

The stock must fall for you to profit. If it grinds sideways, time decay erodes the long put faster than the short put and the spread loses value.

Profit is capped at the short strike. In a crash the spread earns no more than its width, while a single long put would keep gaining.

Debit spreads reach full value slowly. Even with the stock below both strikes, the spread may trade below its width until the last days because the short put retains time value.

If the short put finishes in the money while the long put does not, or it is assigned early, you can be forced to buy 100 shares and must exercise the long put or sell stock to flatten.

Wide bid-ask spreads on two legs reduce a profit that is already limited to a few dollars per share, especially on illiquid underlyings or far-out expirations.

Managing the Trade

Many traders close once the spread has captured 50 to 75 percent of its maximum value, since squeezing out the final dollars often means weeks of added exposure.

If the stock drops quickly and early, consider rolling the short put down to a lower strike for more room to profit, accepting a larger total debit.

If the stock rises but the bearish thesis is intact, rolling the whole spread to a later expiration keeps the trade alive, usually at an additional cost.

Set a loss limit in advance, often 50 percent of the debit, so a losing spread is exited rather than held until it goes to zero.

Close or roll before expiration if the stock is near either strike. One leg being assigned while the other expires worthless creates an unwanted stock position over the weekend.

Bear Put Spread FAQs

How do you calculate bear put spread max profit and max loss?

Maximum loss is the net debit paid, multiplied by 100 per contract. Maximum profit is the difference between the strikes minus the net debit, also multiplied by 100. Buying a $100 put and selling a $90 put for $2.80 gives a max loss of $280 and a max profit of $720.

Where is the breakeven on a bear put spread?

Breakeven is the long put strike minus the net debit. In the example that is $100 minus $2.80, or $97.20. Below that price at expiration the trade is profitable, and the gain grows until the stock reaches the short strike.

Bear put spread vs long put: which is better?

A long put has a larger potential payoff if the stock collapses but costs more, breaks even further away, and loses more to time decay and falling volatility. A bear put spread costs less and breaks even closer to the current price but caps the profit at the short strike. For a modest decline to a target the spread usually offers a better return on risk; for a crash scenario the long put wins.

Bear put spread vs bear call spread: what is the difference?

Both are bearish vertical spreads with the same shaped payoff. The bear put spread is a debit spread that needs the stock to fall past its breakeven. The bear call spread is a credit spread that profits if the stock simply stays below the short call. Traders favor the call credit spread when implied volatility is high and the put debit spread when volatility is low and they have conviction on direction.

Can you use a bear put spread to hedge a stock position?

Yes. One spread hedges 100 shares against a decline between the two strikes at a fraction of the cost of a protective put. The limitation is that protection stops at the short strike, so a fall beyond it is not covered. It works well as insurance against a moderate pullback rather than a catastrophe.

What happens if a bear put spread expires in the money?

If the stock is below both strikes, the long put is exercised and the short put is assigned, which net to zero shares and a cash gain equal to the strike width. If the stock finishes between the strikes, only the long put is exercised and you would be short 100 shares, so most traders close the spread on the final day rather than let it settle.