Bullish · Credit · Defined risk
Bull Put
Spread
A bullish income trade: collect a credit and profit if the market holds up or rises. Defined risk, time decay on your side — here's how to build it.
What it is
A bull put spread (a put credit spread) means selling a higher-strike put and buying a lower-strike put of the same expiry. You receive a net credit and keep it if the underlying stays at or above the higher strike. Time decay works for you.
Key facts
- Market view: moderately bullish to neutral.
- Construction: Sell 1 higher-strike put + Buy 1 lower-strike put (same expiry).
- Net result: credit — received up front.
- Max profit: the net credit, if it expires at/above the higher strike.
- Max loss: (higher strike − lower strike) − net credit.
- Breakeven: higher strike − net credit.
Bull put spread — keep the credit if price holds above the higher strike; loss capped below the lower strike.
Worked NIFTY example
NIFTY at 22,500. Sell the 22,400 put for 90 and buy the 22,200 put for 40 → net credit 50 (illustrative):
- Max profit: 50, if NIFTY expires at/above 22,400.
- Max loss: (22,400 − 22,200) − 50 = 200 − 50 = 150, at/below 22,200.
- Breakeven: 22,400 − 50 = 22,350.
When to use it
- You're bullish/neutral and want time decay and high IV on your side.
- You prefer a defined-risk credit trade over paying a debit.
- There's clear OI/price support above your short strike.
Risks to respect
- Max loss is larger than the credit — a fall below the lower strike hits the cap.
- Risk/reward is skewed (small credit, larger potential loss) — pick strikes and size carefully.
Build the credit spread live
See credit, breakeven and max loss on TradePulse's strategy builder before placing it.
Related strategies
- Bear Call Spread — the bearish credit-spread mirror.
- Bull Call Spread — bullish debit version.
- Iron Condor — combines both credit spreads.