Put Ratio Backspread

Put Ratio Backspread

An investment strategy that combines options to create a spread which has limited loss potential and a mixed profit potential.

Notes:

It's created by combining long and short puts in a ratio such as 2:1 or 3:1.

See also: Call Ratio Backspread, Put, Spread

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Put ratio backspread

A complex options strategy adopted when one believes a stock price will decline but wants to protect against it rising.