Strategy - BEAR SPREAD (details below)

• bullish
• bearish
  • very bearish
  • certain that the market will not rise
  • moderately bearish + fairly certain that the market will not rise
  • flat or mod. bullish in near-term (weeks) + bearish in longer term (months)
  • hold stock and bearish
• neutral
• volatile

Strategy Implementation
Call option is sold with a strike price of a and another call option bought with a strike of b, producing a net initial credit,
OR
Put option is sold with a stike of a and another put bought with a strike of b, producing a net initial debit.

Upside Potential
Limited in both cases -
Calls: net initial credit Puts: difference between strikes minus initial debit
Maximum profit if market at expiry is below the lower strike.

Downside Risk
Limited in both cases -
Calls: difference between strikes minus initial credit
Puts: net initial debit
Maximum loss if at expiry market is above the higher strike.

Margin
Possibility for margin requirements to be off-set.

Comment
Time value erosion not too significant due to the balanced position. .