The Bear Put Spread
is an options strategy that involves the purchase of a Put Option
with a higher strike and the selling of another Put Option
with a lower strike.
The sold put makes the strategy cheaper (compared to the purchase of a single put), while still allowing the investor to get a profit if the stock price decreases.
The disadvantage of a Bear Put Spread
(compared to a simple Long Put
position) is that the P/L of the strategy is limited.