When it comes to Options Trading, there are different complexities involved in terms of choosing a specific strategy that works the best for you.
At the same time, each strategy has its own set of advantages as well as limitations, thus making the concept of options trading even more challenging. Thus, in case you are looking to fit a particular strategy in your option trades, just check few areas before you make a choice.
In this detailed comparison of Short Put Vs Bull Put Spread options trading strategies, we will be looking at the below-mentioned aspects and more:
- Current Market Position
- Your Risk Appetite
- Your Trading Experience
- Profit Potential
- Intention and Expectation of a trader
- Break-even point of your trade
Apart from the Short Put Vs Bull Put Spread strategies, there are more than 25 comparisons of each of these strategies with other option strategies. With all these comparisons, you should be able to filter the ones that work the best for you.
Here is the detailed Short Put Vs Bull Put Spread comparison:
| Comparison Aspect | Bull Put Spread | Short Put |
| View |  |  |
| Strategy Introduction | Bull Put Spread comes into play when the trader is expecting the market is going up gradually, but moderately. So, this is also suitable for a moderately bullish forecast, just like the bull call option...more | The short put strategy is used when the investor is bullish towards the market and expects the prices to go up. He then sells the put option and makes a profit if...more |
| Investor Obligation | Bull put spread is more ideal if the there is very high volatility in the market, time to expiration date is more and the market has declined considerably. | Investor is obligated to sell the shares at the predetermined price, at the time of expiry, if the buyer of the put option chooses to exercise his option. |
| Market Position | Moderately Bullish | Bullish |
| Strategy Level Suitable for | Intermediates | Beginners |
| Options Traded | Put | Put |
| Number of Positions | 2 | 1 |
| Action Needed | Buy OTM Put, Sell ITM Put | Sell Put Option |
| Risk for You | Limited | Unlimited |
| Profit Potential | Limited | Limited |
| Break Even Point for Investor | Strike price of short put MINUS net premium paid | Strike Price MINUS Premium |
| Investor Intention | Let Options Expire Worthlessly | Let Options Expire Worthlessly |
| Investor Expectation | Market Prices to Go Up | Prices go up sharply |
| Strategy Summary | Limited Risk, Limited Gains | Complex & Risky |
| Advantages | Limited Risk | Steady source of income till market remains bullish |
| Disadvantages | Limited Profit | High Risk, Limited Profit |
| Market Scenarios - Profit | 3 | 1 |
| Market Scenarios - Loss | 2 | 2 |
| Also called as | NA | Naked Put or Uncovered Put |
| More Comparisons | Bull Put Spread Vs Short Put | Short Put Vs Long Put |
| Bull Put Spread Vs Long Combo | Short Put Vs Long Combo | |
| Bull Put Spread Vs Synthetic Call | Short Put Vs Synthetic Call | |
| Bull Put Spread Vs Long Put | Short Put Vs Short Call | |
| Bull Put Spread Vs Long Call | Short Put Vs Long Call | |
| Bull Put Spread Vs Covered Call | Short Put Vs Covered Call | |
| Bull Put Spread Vs Covered Put | Short Put Vs Covered Put | |
| Bull Put Spread Vs Protective Call | Short Put Vs Protective Call | |
| Bull Put Spread Vs Short Box | Short Put Vs Short Box | |
| Bull Put Spread Vs Long Call Condor | Short Put Vs Long Call Condor | |
| Bull Put Spread Vs Short Call Condor | Short Put Vs Short Call Condor | |
| Bull Put Spread Vs Box Spread | Short Put Vs Box Spread | |
| Bull Put Spread Vs Short Strangle | Short Put Vs Short Strangle | |
| Bull Put Spread Vs Long Strangle | Short Put Vs Long Strangle | |
| Bull Put Spread Vs Collar Strategy | Short Put Vs Collar Strategy | |
| Bull Put Spread Vs Long Straddle | Short Put Vs Long Straddle | |
| Bull Put Spread Vs Short Straddle | Short Put Vs Short Straddle | |
| Bull Put Spread Vs Long Call Butterfly | Short Put Vs Long Call Butterfly | |
| Bull Put Spread Vs Short Call Butterfly | Short Put Vs Short Call Butterfly | |
| Bull Put Spread Vs Bear Call Spread | Short Put Vs Bear Call Spread | |
| Bull Put Spread Vs Bear Put Spread | Short Put Vs Bear Put Spread | |
| Bull Put Spread Vs Bull Call Spread | Short Put Vs Bull Call Spread | |
| Bull Put Spread Vs Short Call | Short Put Vs Bull Put Spread |
Thus, with this, we wrap up our comparison of Short Put Vs Bull Put Spread option strategies.
At the same time, if you are in a moderately bullish forecast situation and want to take a limited risk, then Bull Put Spread is one of the options trading strategies you can look out for. The profit you get using this strategy is also limited in scope.
However, if your risk appetite is relatively high – then you can try Short Put although the profit potential in that strategy is limited.
Furthermore, as said above, it also depends on the market situation.
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