ETF Bear Put Spread Options Strategy Explained

Exchange-traded funds (“ETFs”) have become a very valuable tool for investors seeking exposure to all corners of the market. While they provide diversified exposure in a single U.S.-traded security, equity options can be used in conjunction with ETFs to create more complex trading strategies designed to achieve specific goals or targeted strategies [see also ETF Call And Put Options Explained]. In this article, we’ll take a look at how bear put spreads can be used to place a controlled bearish bet on an ETF’s direction. What Is a Bear Put Spread Strategy? Suppose that an investor has a bearish outlook on a commodity like gold and wishes to devise a strategy to profit from its decline; however, short-selling the SPDR Gold Trust could be a bit risky given the commodity’s volatile dependence on external events. After all, a single comment out of the U.S. Federal Reserve about further easing could send [...] Click here to read the original article on ETFdb.com. Related Posts: Wednesday’s ETF Chart To Watch: GLD Rebound Hinges On FOMC Minutes ETF Insider: Asia Pacific Country Fund Looks Ripe For Rebound, Gold Offers A Hedge Thursday’s ETF Chart To Watch: GLD Heading To Support Ahead Of U.S. Inflation Data ETF Options Strategies: Neutral Calendar Spread Explained 7 Articles ETF Investors Must Read: 4/18