Bearish Strategies
11 strategies
Bearish spread strategy using calls. Involves selling a call at a given strike price and buying a call at a higher strike price. Generates initial credit and profits from a decline or stability of the underlying asset.
Buying a put at a given strike price and selling a put at a lower strike price. This debit strategy profits from a moderate decline in the underlying while limiting initial cost and risk.
Combination of two bear spreads at different strike price levels to maximize bearish gain potential while keeping risk controlled. Advanced strategy for anticipating a strong decline.
Selling a put while being short on the underlying shares. Allows generating additional income on an existing short position. Upside risk limited by the short position.
Simple purchase of a put option to fully benefit from an anticipated decline. Risk limited to the premium paid, significant gain potential in case of a sharp drop in the underlying.
Buying multiple puts at one strike price and selling puts at a higher strike price. Allows profiting from a sharp decline with reduced initial cost, but exposes to limited upside risk.
Selling a call without coverage. Very aggressive strategy that generates immediate income but exposes to theoretically unlimited losses if the underlying rises sharply. Reserved for experienced traders.
Buying 1 call and selling 2 calls at a higher strike. Benefits from a calm or slightly bullish market. Generates income through time decay, but exposes to unlimited losses in case of sharp rise.
Short selling of shares. Direct bearish position that profits from the decline in share price. Gain potential limited to purchase price, but theoretically unlimited risk if the stock rises.
Combination of a short position on the stock and buying a call. Economically replicates a long put. Allows profiting from a decline while limiting upside risk through the call.
Selling a call and buying a put at the same strike and expiration. Replicates a short stock position without borrowing shares. Profits from decline with theoretically unlimited upside risk.