Purchasing a put with a lower strike price than the written put provides a bullish strategy. Trade will be doing this coming week.
Stock: FANG Current Price: 113.86
Short Put WRITE Option: 15th Jun $115.00 PUT Price per option: $ 2.85 Contracts: #1 x 100 Total cost: $285 Long Put BUY Option: 15th Jun $110.00 PUT Price per option: $ 0.83 Contracts: #1 x 100 Total cost: $83
Spread: Net debit/credit: $2.02 (net credit) x 100 = $202.00 Maximum risk: $298 at a price of $110 at expiry Maximum return: $202 at a price of $115 at expiry Breakevens at expiry: $113.00