Put Backspread

Directional

Sell 1 higher put, buy 2 lower puts.

Performance across all datasets

SymbolReturn %SharpeMax DD %Win %Avg/trade %Trades
SPY+1336.5%0.83+352.2%+89.5%+70.3%19
QQQ+1421.6%1.35+93.4%+89.5%+74.8%19
IWM+1631.2%1.25+104.8%+89.5%+85.8%19
DIA+1123.4%0.64+405.7%+84.2%+59.1%19
Avg+1378.2%1.02+239.0%+88.2%19
Cumulative P&L % — all symbols
Detail:
Cumulative P&L % — SPY

Risk Profile

Max Profit
Large downside
Max Loss
Between strikes
Breakeven
Depends on entry credit/debit
Outlook
Bearish with vol expansion

Parameters

ParameterDefaultDescription
ratio1x2Short/long put ratio

Methodology

Backspread for downside convexity; profits in sharp selloffs and often carries limited upside risk.

Implementation

# -P(K1) + 2P(K2)