Bull Put Spread Calculator: Profit, Loss & Breakeven

Before you sell a put credit spread, you should know exactly what you can make and what you can lose. This bull put spread calculator turns your strikes and premiums into a clear answer: the net credit you collect, the maximum loss you accept, your breakeven price and the profit you keep if the stock holds above the strike price of the put you sell. Below you'll find the formulas behind every result, a worked example with real numbers and the strategy rules that keep those numbers realistic for anyone trading options.

How the Bull Put Spread Calculator Works

Every result comes from a handful of inputs you can read straight off your broker's option chain. A bull put spread pairs two put options on the same underlying stock with the same expiration, so an options spread calculator only needs to know where each leg sits, what it pays or costs and how many spreads you plan to trade.

Stock price, strike price and expiration inputs

Start with the stock price, the current price of the underlying asset. It doesn't change the result on expiry day, but it lets the chart show how far the underlying price sits from each strike price you choose. Then enter the two strikes and the timing:

• Short strike: the higher strike price, where you sell the put option. It sets the level above which you keep the whole net premium.
• Long strike: the lower strike price, where you buy the protective put. It marks the point where your downside stops growing.
• Days to expiration: the time left before both options expire. It only matters for the modeled curve, because the payoff of the spread on expiry day is fixed by the strikes and the premiums.

Premium and spread quantity inputs

Next comes the money. Enter the premium received for the put you sell and the premium you pay for the put you buy; the difference is your net premium, better known as the net credit. Some calculators also offer a modeled mode where you supply volatility and let a pricing model estimate both premiums from market data. Finally, set the spread quantity. Each contract controls a 100-share lot, so every dollar result is multiplied by 100 and by the number of contracts you trade.

Results: net credit, max profit and max loss

Once the inputs are in, the calculator returns four results and a chart:

1. Net credit: the money that lands in your account when the trade opens.
2. Max profit: that same amount, scaled up to your position size.
3. Max loss: the most you can lose, reached if the stock price finishes at or below the lower strike.
4. Breakeven: the price where the trade neither earns nor loses money.

Read them together. A big premium means little if the max loss dwarfs it, and a wide cushion means little if the payout barely covers your commissions. Because the strategy pays you first and asks questions later, a quick look at all four numbers is the best defense against a trade that only looks attractive.

What Is a Bull Put Spread?

A bull put spread is a two-legged strategy that pays you upfront to take a moderately bullish view on a stock. You sell one put option at a higher strike price, buy another put option at a lower strike price and choose the same expiration date for both. Because the put you sell is worth more than the put you buy, money comes in on day one. That is why the trade is also called a put credit spread, a short put spread or, on some platforms, a credit put spread. It is popular in options trading with investors who want steady income rather than a big directional bet.

The short put and long put legs

The short put is the engine of the trade. It collects the bigger premium, and it is the leg that loses money if the price falls below its strike. The long put is the seatbelt. It costs you part of that premium, but it gains value dollar for dollar once the stock drops under its own strike, which caps the damage. Neither option works alone: the two legs together create the spread.

Why a bull put spread has defined risk

Selling a put on its own exposes you to a severe drawdown if the stock collapses, because the damage can run all the way to zero. Adding the protective option turns that open-ended exposure into defined risk. The worst case is known the moment you enter the trade, and it is the same whether the stock price drops a little under the protective put's strike price or a lot. That limited risk comes with capped profit, since you can never earn more than the premium received.

When traders use a bull put spread strategy

Traders reach for this strategy when they think a stock will rise, drift sideways or at least hold above a certain level. It suits a moderately bullish or neutral outlook better than a strongly bullish one, because a big rally earns exactly the same payout as a small one. A trader who likes this setup is really betting that the stock stays above the breakeven price, not that it soars, which makes the bull put spread strategy a favorite for income generation when market sentiment is cautiously positive. Steady time decay is the other attraction, since it works in your favor every day the trade stays healthy.

Vertical Spread Formulas: Net Credit, Max Profit, Max Loss and Breakeven

Every number the calculator prints comes from a few short formulas. Let \(K_s\) be the higher strike, \(K_l\) the lower strike, \(P_s\) the premium collected from the put you sell, \(P_l\) the premium paid for the put you buy and \(n\) the number of spreads.

Net credit and maximum profit

The net credit is the premium received on the put you sell minus the premium you pay for the put you buy, per share:

Your maximum profit is that net premium, scaled by the 100-share multiplier and your position size:

You keep every dollar of it when both options expire worthless, which happens if the closing price lands at or above \(K_s\). Nothing else you do, and no further rally, adds to it.

Maximum loss and spread width

The spread width is the gap between the two strikes:

The maximum loss is that width minus the net premium you already banked, scaled the same way:

You reach it when the price finishes at or below \(K_l\), because the gain on the put you bought then offsets the drop on the put you sold dollar for dollar.

Breakeven price at expiration

The breakeven price is the strike price of the put you sell, less the net premium per share:

Below \(B\) you lose money, above it you make money. Between \(B\) and \(K_s\) you still profit, just less than the full premium. For any closing price \(S\), the result follows from both puts together:

Return on risk

To judge whether the payout is worth the risk, divide it by what you stand to lose:

A higher \(R\) means you are paid more for each dollar at risk, but it usually comes with strikes closer to the current market price and a lower chance of keeping the full amount, which is the core trade-off of the strategy.

Bull Put Spread Example With Real Numbers

Numbers make the formulas concrete, and a profit calculator earns its keep when you can check it against a hand calculation. Suppose a stock trades at $64.85 and you expect it to hold above $62.50 for the next 38 days. You place a bull put spread on three spreads.

Trade setup

• Sell the 62.50 put option for $1.72 per share, the short put.
• Buy the 57.50 put option for $0.64 per share, the long put.
• Width between the strikes: \(62.50 - 57.50 = 5.00\).
• Net credit: \(1.72 - 0.64 = 1.08\) per share, the premium received after paying for protection.
• Maximum profit: \(1.08 \times 100 \times 3 = 324\) dollars.
• Maximum loss: \((5.00 - 1.08) \times 100 \times 3 = 1{,}176\) dollars.
• Breakeven: \(62.50 - 1.08 = 61.42\).

The stock sits 3.43 above that level, a cushion of about 5.3 percent. The return on risk is \(324 \div 1{,}176\), or 27.6 percent.

Profit and loss at different closing prices

The table below applies the formula above to a range of closing prices on expiration day.

Notice the flat ends. Below $57.50 the loss is stuck at $1,176 and above $62.50 the profit is stuck at $324. Everything interesting happens in the five-dollar band between the strikes.

How to Read the P/L Chart for This Options Strategy

The P/L chart plots profit or loss on the vertical axis against the stock price on the horizontal axis. A bull put spread always draws the same shape: a flat loss on the left, a straight diagonal through the strikes and a flat profit on the right.

The three zones of the payoff

• Below the lower strike: both puts are in-the-money and the protective put offsets the one you sold, so the loss is capped.
• Between the strikes: only the put you sold ends in the money, so your profit shrinks by one dollar for each dollar the price falls.
• Above the higher strike: both puts are out-of-the-money and expire worthless, so you keep the entire net premium.

The T+0 curve and modeled pricing

Many calculators draw a second line labeled T+0, meaning today plus zero days. It estimates your profit if the price moved right now, using the Black-Scholes model to price both puts before expiry. Because time value, the part of an option's price above its intrinsic value, is still there, this curve is smoother than the line for expiration day. While the stock sits above your short put, the T+0 line runs below the expiration line, and the gap between them is the time decay still waiting to be earned.

Treat the modeled curve as an estimate. Black-Scholes assumes European-style options, a constant risk-free rate, a fixed dividend yield and one volatility for both strikes, while real prices show a volatility skew that makes the lower strike more expensive than the model expects. It also ignores that American-style options can be exercised early. The line for expiration day, by contrast, needs none of those assumptions.

Vertical Spread Walkthrough: Checking One Trade Against a Risk Cap

Your account holds $40,000, and your rule caps any single trade at 2 percent of it, or $800. A large-cap stock closes at $418.30, and you want income while it holds above the $405 level, 3.2 percent below the close. The 405 put pays $6.84 and the 395 put costs $4.11, so you enter those premiums with one spread and 31 days to go.

The results appear at once:

• Net credit: \(6.84 - 4.11 = 2.73\) per share, or $273 for the spread.
• Maximum loss: \((10 - 2.73) \times 100 = 727\) dollars.
• Breakeven: \(405 - 2.73 = 402.27\), 3.8 percent below the close.
• Return on risk: \(273 \div 727\), or 37.6 percent.

The $727 worst case clears your $800 cap with $73 to spare. A second spread would put $1,454 at risk, 3.6 percent of the account, so one spread is the limit.

Before sending the order, you change a single input: the long strike drops to 390, where the put costs $3.05. The wider spread pays a net credit of $3.79 and moves breakeven to $401.21, which looks better. But the width is now 15, and the maximum loss jumps to $1,121, well past $800. The 405 strike sits $13.30 below the close, so early assignment is a distant concern on day one. You go back to the 395 put, enter a limit order at a $2.73 credit and set an alert to close the spread once it can be bought back for $1.37, half the credit collected.

Bull Put Spread vs Bull Call Spread and Bear Put Spread

The bull put spread belongs to a family of four vertical spreads. A vertical spread calculator handles all four the same way, so the choice comes down to your market outlook and your appetite for risk.

Bull put spread vs bull call spread

Both are bullish, limited-risk trades with capped profit. A bull call spread buys a lower-strike call option and sells a higher-strike call option, so it costs money to open. A bull put spread takes in money instead. With the same strikes and expiration date, the two strategies have nearly identical risk and reward. The practical difference is which options are out of the money: many traders prefer to sell puts with strikes below the price because those options are usually more liquid and less exposed to early assignment.

Bear put spread and bear call spread

A bear put spread flips the outlook to bearish. You buy the higher-strike put option and sell the lower-strike put option for a debit, and you gain when the price falls. Its credit-side twin is the bear call spread, which sells a lower-strike call option and buys a higher-strike call option for a payout up front. If you are bearish and want to be paid, use the bear call spread; if you are bullish and want to be paid, use the bull put spread. A bull put spread is also half of an iron condor, which adds a bear call spread above the market.

Bull put spread vs naked put

A naked put collects more premium than a spread but leaves the downside almost unlimited and ties up far more capital. The spread trades some of that premium for a hard ceiling on risk. When you are happy to own the shares at the strike, a cash-secured put can make sense; when you only want income, the spread is the safer way to get it.

Credit Spread vs Debit Spread: Choosing a Vertical Spread

Every vertical spread is either a credit spread or a debit spread. A credit spread pays you at the start and you win by keeping that payout, so time is on your side. A debit spread costs you at the start and you win when the price moves far enough in your direction. The bull put spread and the bear call spread are the two credit strategies; the bull call spread and the bear put spread are the two debit strategies.

Choose a credit structure when you expect the market to stay put or move modestly, and when volatility is elevated so the premium you collect is larger. Choose a debit structure when you expect a bigger market move and volatility is cheap. The net debit you pay for a debit spread is also the most you can lose, while the payout you take in on the other side is the most you can earn, so the two mirror each other.

Put Spread Greeks, Time Decay and Implied Volatility

The Greeks describe how the value of the spread changes as conditions change. For this strategy the picture is simple enough to summarize in one table.

Delta and gamma

Delta tells you how much the spread gains for each dollar the price rises. The put you sell has a larger delta than the put you buy, so the position has a small positive net delta and profits from a rising stock. Gamma measures how quickly that sensitivity shifts. It matters most in the final days, when a stock sitting near the strike price of the put you sold can swing the spread from profit to loss in a single session.

Theta and time decay

Time decay is the reason many traders favor this strategy and sell spreads to collect premium. As expiration approaches, the extrinsic value in both options melts away. While the stock price stays above the strike price you sold at, the put you sold loses value faster than the put you bought, so the spread has positive theta and drifts toward its best outcome. If the price falls toward the protective put's strike price, that benefit fades and can reverse, because you then need the protection the long put provides.

Vega and implied volatility

A bull put spread has negative vega, so a jump in implied volatility raises the price of the spread and works against you, while a drop helps you. That is why selling ahead of earnings can pay: volatility is inflated beforehand and often collapses afterward. The trade-off is that the same event can also move the stock and the wider market sharply. Rho, the sensitivity to interest rates, is small enough that most traders ignore it for spreads with a few weeks to run.

Managing a Vertical Spread Before and After Expiration

Placing the trade is only half the job. What you do as expiration approaches decides whether you keep the premium.

Early assignment on the short put

The put you sold can be assigned early, usually when it is deep in-the-money and little time value is left, or just ahead of a dividend. That assignment risk is real but manageable. You would become long a 100-share lot per spread, and the protective put still covers you. You can exercise the long put to sell that stock at its strike price, or close both positions in the market. Either way the strategy caps your downside. Brokers charge assignment fees, so check your fee schedule, because a fee larger than your remaining profit changes the math.

Rolling the spread and pin risk

If the stock drifts toward your short put, you can close the spread and open a new one with a later expiration date, which traders call rolling. Doing it for a net credit gives the trade more time, but it also extends your exposure, so decide in advance how many times you will do it. Pin risk is the other hazard: if the stock closes almost exactly at the strike price of the put you sold on expiration day, you can't know whether you'll be assigned. Closing the spread before the final bell removes that uncertainty.

What happens at expiration

• Price above the higher strike: both puts lapse with no value and you keep the whole net premium. No action is needed.
• Price between the strikes: the put you sold ends in the money, so you must buy the stock at its strike price, while the put you bought lapses with no value. Your cost basis sits below that level.
• Price below the lower strike: you buy the stock at the higher strike and sell it at the lower strike through the protective put, which realizes your maximum loss.

Risk Management Tips for This Options Strategy

Discipline matters more than any single calculation. Sound risk management keeps a run of small wins from being erased by one bad trade, and options trading rewards the traders who plan the exit before they place the entry.

Position sizing and margin requirement

Your brokerage holds back the worst-case loss as a margin requirement for each spread, so the cash tied up equals the width minus the net premium. Size the strategy by that worst case, not by the payout. A common guideline is to risk only a small slice of your capital on any one trade and to spread exposure across different stocks and expirations for basic diversification within your portfolio.

Liquidity and common mistakes

• Ignoring liquidity: wide bid-ask spreads and thin open interest cost you real money on entry and exit. Favor options that trade actively.
• Choosing the wrong term: when you compare each bull put spread option on the chain, remember that shorter terms decay faster but leave less time to be wrong.
• Chasing premium: a fat payout usually means the higher strike sits close to the stock, which raises the chance of a loss.
• Forgetting costs: commissions and fees come out of a payout that is often only a dollar or so per share.
• Selling into a known event: earnings and economic reports can gap a stock straight through both strikes.

Calculators like this one are educational tools, not advice, and no strategy removes risk. Actual fills, dividends, early exercise and changing market conditions will move the real outcome away from the model, so treat the results as a planning aid and confirm the trade in your own trading platform before you send the order.