Bear Put Spread (25 Jul 11)

TO ALL:

Here are the “potential trades” for next week:

Bear Put Spread (ETFs)

A Bear Put spread is a debit spread created by purchasing a Put with a higher strike price and selling a Put with a lower strike price.  Both options expire in the same month.  This is a bearish strategy and should be implemented when you expect the market to close below the strike price of the short Put option—the point of maximum reward (at expiration).   

QID $45.83

Buy to Open (1) Aug 11 48 P @ $3.35

Sell to Open (1) Aug 11 43 P @ $0.47 

Net Debit: $2.88 ($288.00)

Breakeven: $45.12

Max. Profit: $212.00

Pct Return: 73.6% (27 days)

All positions displayed are for educational purposes only and are not intended to be recommendations.