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Definition, Examples & Resources:Bear Spread'

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What is Bear Spread in Options Trading ?

Bear Spread
A bear spread is a call or put options trading strategy in which different options are combined with different expiry dates to take advantage of expected downward move in the market or security. Options, generally of same expiry dates with higher strike price is bought and lower strike priced option is written in this strategy. If the trader wants to put on the trade for a credit, a lower strike call can be sold and a higher strike call can be purchased. Here's a short video explaining vertical spreads. Bear spreads are types of vertical spreads. If you haven't checked out TastyTrade, we recommend you do so. Their education is second to none and they have some great brokerage tools in the works for beginner traders.

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