Buy call Use when you expect the price of the underlying to rise strongly. Max loss: Premium paid Max profit: Unlimited Why choose it: Simple directional exposure with defined risk Sell put Use when you expect the price of the underlying to stay above a specific level or rise moderately. Max loss: Significant (if price drops sharply) Max profit: Premium received Why choose it: Express a bullish view while collecting a premium Bull call spread Use when you expect the price of the underlying to rise moderately. Max loss: Premium paid Max profit: Capped Why choose it: Lower cost than a call, with defined risk and reward Bull put spread Use when you expect the price of the underlying to stay above a specific level. Max loss: Capped Max profit: Premium received Why choose it: Collect premium with limited downside risk

Buy put Use when you expect the price of the underlying to fall strongly. Max loss: Premium paid Max profit: High (as price falls) Why choose it: Direct downside exposure with defined risk Sell call Use when you expect the price of the underlying to stay below a specific level or fall slightly. Max loss: Unlimited Max profit: Premium received Why choose it: Express a neutral-to-bearish view while collecting premium Bear put spread Use when you expect the price of the underlying to fall moderately. Max loss: Premium paid Max profit: Capped Why choose it: Lower cost than a put, with defined risk Bear call spread Use when you expect the price of the underlying to stay below a specific level. Max loss: Capped Max profit: Premium received Why choose it: Collect premium with limited risk

If you want to... Then... Trade a strong move up Buy a call Trade a strong move down Buy a put Trade a moderate move Use a bull or bear spread, matching your view Trade a range or low volatility Sell premium (puts if you’re bullish, calls if you’re bearish) Lower your cost Use spreads instead of outright buys Define your risk Avoid selling options without a hedge (known as uncovered or “naked” selling)

Choosing an options strategy

Last updated: 8 October 2026

Start with your market view, then build a strategy that matches your appetite for risk, cost and potential profit. Your view comes first, the structure follows.

Bullish strategies

Buy call

Use when you expect the price of the underlying to rise strongly.

Max loss: Premium paid
Max profit: Unlimited
Why choose it: Simple directional exposure with defined risk

Sell put

Use when you expect the price of the underlying to stay above a specific level or rise moderately.

Max loss: Significant (if price drops sharply)
Max profit: Premium received
Why choose it: Express a bullish view while collecting a premium

Bull call spread

Use when you expect the price of the underlying to rise moderately.

Max loss: Premium paid
Max profit: Capped
Why choose it: Lower cost than a call, with defined risk and reward

Bull put spread

Use when you expect the price of the underlying to stay above a specific level.

Max loss: Capped
Max profit: Premium received
Why choose it: Collect premium with limited downside risk

Bearish strategies

Buy put

Use when you expect the price of the underlying to fall strongly.

Max loss: Premium paid
Max profit: High (as price falls)
Why choose it: Direct downside exposure with defined risk

Sell call

Use when you expect the price of the underlying to stay below a specific level or fall slightly.

Max loss: Unlimited
Max profit: Premium received
Why choose it: Express a neutral-to-bearish view while collecting premium

Bear put spread

Use when you expect the price of the underlying to fall moderately.

Max loss: Premium paid
Max profit: Capped
Why choose it: Lower cost than a put, with defined risk

Bear call spread

Use when you expect the price of the underlying to stay below a specific level.

Max loss: Capped
Max profit: Premium received
Why choose it: Collect premium with limited risk

Quick reference

If you want to...	Then...
Trade a strong move up	Buy a call
Trade a strong move down	Buy a put
Trade a moderate move	Use a bull or bear spread, matching your view
Trade a range or low volatility	Sell premium (puts if you’re bullish, calls if you’re bearish)
Lower your cost	Use spreads instead of outright buys
Define your risk	Avoid selling options without a hedge (known as uncovered or “naked” selling)

Compare options strategies

Use this table to quickly compare common options strategies.

Strategy	Market view	Max loss	Max profit	Why choose it
Buy call	Rise strongly	Premium paid	Unlimited	Simple directional exposure with defined risk
Sell put	Stay above a level or rise moderately	Significant (if price drops sharply)	Premium received	Express a bullish view while collecting a premium
Bull call spread	Rise moderately	Premium paid	Capped	Lower cost than a call, with defined risk and reward
Bull put spread	Stay above a level	Capped	Premium received	Collect premium with limited downside risk
Buy put	Fall strongly	Premium paid	High (as price falls)	Direct downside exposure with defined risk
Sell call	Stay below a level or fall slightly	Unlimited	Premium received	Express a neutral-to-bearish view while collecting premium
Bear put spread	Fall moderately	Premium paid	Capped	Lower cost than a put, with defined risk
Bear call spread	Stay below a level	Capped	Premium received	Collect premium with limited risk

Using the table

Start with your market view
Compare the risk and potential payoff
Choose the structure that matches your conviction and risk tolerance