2. Bull Put Spread Strategy Name: BULL PUT SPREAD Direction: Bullish Max. Risk: Capped Type: Income Volatility: N/A Max. Reward: Capped Proficiency: Intermediate Legs: 1. Buy lower Strike (SP L ) Puts 2. Sell higher Strike (SP H ) Puts Entry: Try to ensure that the trend is upward or range bound.

3. Risk Profile : Net Credit: higher strike premium - lower strike premium Max. Risk: (Higher SP – Lower SP) – Net Credit Max. Reward: Net Credit BEP: Higher SP - Net Credit Investment: Span Margin ROI: Profit/Investment

4. Exit: With this strategy, you can simply unravel the spread by buying back the puts you sold and selling the puts you bought in the first place.

5. Example: Month Long/Short Option Call/Future/Put Price Qty Oct Long 5500 Put 20 1000 Oct Short 5800 Put 80 1000 Net Credit: 60000 Max. Risk: 240000 Max. Reward: 60000 BEP: 5740 Investment: 600000 ROI: 10% @ UP: 5700