ETF Bull Put Spread Options Strategy Explained

Exchange-traded funds (“ETFs”) provide investors with an easy way to reach virtually every corner of the stock market with a single U.S.-traded security. But, those looking to further enhance their trading by limiting risk and/or leveraging profits can take advantage of equity/stock options trading on many of these ETFs [see ETF Call And Put Options Explained]. In this article, we’ll discuss how the bull put spread can be used to profit from a modest rise in an ETF’s share price, while limiting maximum potential losses. What Is the Bull Put Spread Strategy? Suppose that you believe that the S&P 500 SPDR will rebound after a recent fall in share price, but there’s still a risk that the index could breakdown lower. Simply purchasing the ETF risks losing unlimited amounts of money in this downturn, while purchasing call options involves putting up capital right away that could result in some opportunity [...] Click here to read the original article on ETFdb.com. Related Posts: Daily ETF Roundup: XLF Rallies, VNQ Sinks Alongside REITs Daily ETF Roundup: SDY Slumps Alongside High-Yield Sectors, GDX Rips Higher Discretionary ETF (XLY) Resumes Uptrend After Upbeat Confidence Data Daily ETF Roundup: KBE Pops As Banks Charge Ahead, UST Slumps ETF Bull Call Spread Options Strategy Explained