KSTR Bear Put Spread Strategy
KSTR (KraneShares SSE STAR Market 50 Index ETF), in the Financial Services sector, (Asset Management industry), listed on AMEX.
Under normal circumstances, the fund will invest at least 80% of its net assets (plus borrowings for investment purposes) in instruments in its underlying index or in instruments that have economic characteristics similar to those in the underlying index. The underlying index includes the stocks of the top 50 companies by free-float market capitalizations listed on the SSE Science and Technology Innovation Board (the “STAR Board”). It is non-diversified.
KSTR (KraneShares SSE STAR Market 50 Index ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $60.7M, a beta of 1.21 versus the broader market, a 52-week range of 12.97-26.135, average daily share volume of 157K, a public-listing history dating back to 2021. These structural characteristics shape how KSTR etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.21 places KSTR roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a bear put spread on KSTR?
A bear put spread buys an at-the-money put and sells an out-of-the-money put at a lower strike for defined risk and defined reward bounded by the strike width.
Current KSTR snapshot
As of May 14, 2026, spot at $25.22, ATM IV 51.20%, IV rank 18.23%, expected move 14.68%. The bear put spread on KSTR below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 63-day expiry.
Why this bear put spread structure on KSTR specifically: KSTR IV at 51.20% is on the cheap side of its 1-year range, which favors premium-buying structures like a KSTR bear put spread, with a market-implied 1-standard-deviation move of approximately 14.68% (roughly $3.70 on the underlying). The 63-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated KSTR expiries trade a higher absolute premium for lower per-day decay. Position sizing on KSTR should anchor to the underlying notional of $25.22 per share and to the trader's directional view on KSTR etf.
KSTR bear put spread setup
The KSTR bear put spread below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With KSTR near $25.22, the first option leg uses a $25.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed KSTR chain at a 63-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 KSTR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Put | $25.00 | $2.13 |
| Sell 1 | Put | $24.00 | $1.58 |
KSTR bear put spread risk and reward
- Net Premium / Debit
- -$55.00
- Max Profit (per contract)
- $45.00
- Max Loss (per contract)
- -$55.00
- Breakeven(s)
- $24.45
- Risk / Reward Ratio
- 0.818
Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-put strike minus net debit.
KSTR bear put spread payoff curve
Modeled P&L at expiration across a range of underlying prices for the bear put spread on KSTR. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | +$45.00 |
| $5.59 | -77.9% | +$45.00 |
| $11.16 | -55.7% | +$45.00 |
| $16.74 | -33.6% | +$45.00 |
| $22.31 | -11.5% | +$45.00 |
| $27.89 | +10.6% | -$55.00 |
| $33.46 | +32.7% | -$55.00 |
| $39.04 | +54.8% | -$55.00 |
| $44.61 | +76.9% | -$55.00 |
| $50.19 | +99.0% | -$55.00 |
When traders use bear put spread on KSTR
Bear put spreads on KSTR reduce the cost of a bearish KSTR etf position by selling a lower-strike put; suited to moderate-decline theses where price reaches but does not vastly exceed the short strike.
KSTR thesis for this bear put spread
The market-implied 1-standard-deviation range for KSTR extends from approximately $21.52 on the downside to $28.92 on the upside. A KSTR bear put spread caps both the risk and the reward of a bearish position; relative to an outright long put on KSTR, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current KSTR IV rank near 18.23% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on KSTR at 51.20%. As a Financial Services name, KSTR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to KSTR-specific events.
KSTR bear put spread positions are structurally moderately bearish; the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. KSTR positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move KSTR alongside the broader basket even when KSTR-specific fundamentals are unchanged. Long-premium structures like a bear put spread on KSTR are particularly exposed to IV-crush risk through scheduled events (earnings, FDA decisions, central-bank meetings) where IV typically contracts post-event regardless of the directional outcome. Always rebuild the position from current KSTR chain quotes before placing a trade.
Frequently asked questions
- What is a bear put spread on KSTR?
- A bear put spread on KSTR is the bear put spread strategy applied to KSTR (etf). The strategy is structurally moderately bearish: A bear put spread buys an at-the-money put and sells an out-of-the-money put at a lower strike for defined risk and defined reward bounded by the strike width. With KSTR etf trading near $25.22, the strikes shown on this page are snapped to the nearest listed KSTR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are KSTR bear put spread max profit and max loss calculated?
- Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-put strike minus net debit. For the KSTR bear put spread priced from the end-of-day chain at a 30-day expiry (ATM IV 51.20%), the computed maximum profit is $45.00 per contract and the computed maximum loss is -$55.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a KSTR bear put spread?
- The breakeven for the KSTR bear put spread priced on this page is roughly $24.45 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current KSTR market-implied 1-standard-deviation expected move is approximately 14.68%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a bear put spread on KSTR?
- Bear put spreads on KSTR reduce the cost of a bearish KSTR etf position by selling a lower-strike put; suited to moderate-decline theses where price reaches but does not vastly exceed the short strike.
- How does current KSTR implied volatility affect this bear put spread?
- KSTR ATM IV is at 51.20% with IV rank near 18.23%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.