Is there a Bull Put Spread strategy?

CFA Level III
#1

I know there is a bear call and bear put, but I don’t recall seeing a bull put.

#2

Reverse the bear put…i.e., buy what you sell in bear put and sell what you buy…and presto you have a bull put.

#3

Bull Spread can be eitehr Calls or Puts - but usually Calls. There is even Bull sh1t. :slight_smile:

#4

Bull Spread = Buy Low Call, Sell High Call Bull Spread = Sell Low Put, Buy High Put Bear Spread = Buy Low Put, Sell High Put Bear Spread = Sell Low Call, Buy High Call I think that is all correct above… Lets hope I’m not full of Bull sh1t or Bear scat :wink:

#5

So then a bull spread with puts would be: Buy puts with X1 and sell puts with X2?

#6

Is this a correct summary then? Bull Call: Buy low call, short high call Bear Call: Short low call, buy high call Bull Put: Buy low put, short high put Bear Put: Short low put, buy high put I’m certain the call strategies correct. Do I have the put strategies flipped?

#7

Just think of this: Bull = Delta + Bear = Delta - Assume you buy a call at X1 and sell a call at X2: if X2>X1 (X2X1), the delta of the second option will be pos and smaller (larger) in abs value, thus the overall delta is negative (positive).

#8

calls with lower strikes have higher deltas since puts have negative deltas, puts with higher strikes have more positive deltas For calls: buying a low strike and selling a high strike has a net positive delta (bull call) For puts: buying a low strike and selling a high strike has a net positive delta (bull put)