System will be offline from 9 PM - 9: Bull Put Ladder Description The Bull Put Ladder is an extension to the Bull Put Spread. By buying another put at a lower strike, the position assumes uncapped reward potential if the stock plummets.

Master Options Trading: Bull Put Ladder

The problem is that now its not totally clear if we have a bullish or bearish strat- egy, but because we are net long puts and we have uncapped profit potential if the stock falls, do we have to call this a bearish strategy? The answer lies in the reason for the trade and the position of the stock relative to the strikes.

Because we are net long options and particularly OTM options , we are better off trading this as a longer-term strategy in order to counter the effects of time decay.

So, in summary, if the stock falls below the lower buy strike, we make poten- tially uncapped profit until the stock reaches zero; if the stock rises to anywhere between the middle and upper short strikes, we make our maximum loss.

The extra leg also ensures that we may have two breakeven points.

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