Bear Put Spread: An Options Strategy To Try In Declining Markets

In options trading, a bear put spread is also known as a "debit put spread" or a "long put spread." The "bear" in the strategy's name refers to bearish sentiment — betting on the downside of the market. "Put spread" means buying and selling put options with different strike prices, but the same expiration date.

Typically, a bear put spread is used when a trader is expecting the price of an asset to decline. To set up a bear put spread, the trader buys a put option while selling a further out-of-the-money (OTM) put option of the same size with the same expiration date. This allows the trader to reduce the overall cost involved (more on this in the sections below).

Source: Options Playbook