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Vertical bull PUT spread

A compound option strategy of buying two options with a common expiration date; one option is a long PUT with a lower strike price and the other is a short PUT with a higher strike price. The buyer´s maximum profit consists of the net premium paid for the two options (one paid, the other received). The break-even point is calculated as the difference between the higher strike price and the total premium received. The maximum loss is limited to the dollar difference between the two strike prices, minus the total premium received.

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