Short put spread + one more long put lower. Profits on a big drop or a hold.
Shape illustration on a normalized underlying — open the Lab below to price it on a real option chain.
Sell a put spread and buy one more put lower down. Profits if the stock holds (keep the credit) or crashes hard (the extra long put) — the loss pocket is the moderate decline.
When you think a level holds, but want crash insurance included in the trade rather than bought separately.
Maximum loss between the lower strikes at expiration — the orderly selloff that stops at the wrong place. Defined risk, awkward location.
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Educational content — not investment advice. Options involve substantial risk and are not suitable for every investor. All trading on Opus Options Trading is simulated.