NEON Bear Put Spread Strategy
NEON (Neonode Inc.), in the Technology sector, (Hardware, Equipment & Parts industry), listed on NASDAQ.
Neonode Inc., together with its subsidiaries, develops optical sensing solutions for contactless touch, touch, and gesture sensing in the United States, Japan, South Korea, China, and internationally. It also offers software solutions for scene analysis using advanced machine learning algorithms to detect and track persons and objects in video streams for cameras and other types of imagers. In addition, the company licenses its technology to original equipment manufacturers (OEMs) and Tier 1 suppliers. Further, it provides embedded sensors modules to OEMs, original design manufacturers, and systems integrators; and engineering consulting services. Additionally, the company sells Neonode branded sensor products, such as AirBar products through distributors. It serves office equipment, automotive, industrial automation, medical, military, and avionics markets.
NEON (Neonode Inc.) trades in the Technology sector, specifically Hardware, Equipment & Parts, with a market capitalization of approximately $27.5M, a trailing P/E of 3.29, a beta of 1.00 versus the broader market, a 52-week range of 1.27-29.9, average daily share volume of 105K, a public-listing history dating back to 1989, approximately 40 full-time employees. These structural characteristics shape how NEON stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.00 places NEON roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 3.29 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price.
What is a bear put spread on NEON?
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 NEON snapshot
As of May 15, 2026, spot at $1.65, ATM IV 20.90%, IV rank 0.17%, expected move 5.99%. The bear put spread on NEON 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 34-day expiry.
Why this bear put spread structure on NEON specifically: NEON IV at 20.90% is on the cheap side of its 1-year range, which favors premium-buying structures like a NEON bear put spread, with a market-implied 1-standard-deviation move of approximately 5.99% (roughly $0.10 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated NEON expiries trade a higher absolute premium for lower per-day decay. Position sizing on NEON should anchor to the underlying notional of $1.65 per share and to the trader's directional view on NEON stock.
NEON bear put spread setup
The NEON 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 NEON near $1.65, the first option leg uses a $1.65 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed NEON chain at a 34-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 NEON shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Put | $1.65 | N/A |
| Sell 1 | Put | $1.57 | N/A |
NEON bear put spread risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
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.
NEON bear put spread payoff curve
Modeled P&L at expiration across a range of underlying prices for the bear put spread on NEON. 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.
When traders use bear put spread on NEON
Bear put spreads on NEON reduce the cost of a bearish NEON stock position by selling a lower-strike put; suited to moderate-decline theses where price reaches but does not vastly exceed the short strike.
NEON thesis for this bear put spread
The market-implied 1-standard-deviation range for NEON extends from approximately $1.55 on the downside to $1.75 on the upside. A NEON bear put spread caps both the risk and the reward of a bearish position; relative to an outright long put on NEON, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current NEON IV rank near 0.17% 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 NEON at 20.90%. As a Technology name, NEON options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to NEON-specific events.
NEON 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. NEON positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move NEON alongside the broader basket even when NEON-specific fundamentals are unchanged. Long-premium structures like a bear put spread on NEON 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 NEON chain quotes before placing a trade.
Frequently asked questions
- What is a bear put spread on NEON?
- A bear put spread on NEON is the bear put spread strategy applied to NEON (stock). 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 NEON stock trading near $1.65, the strikes shown on this page are snapped to the nearest listed NEON chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are NEON 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 NEON bear put spread priced from the end-of-day chain at a 30-day expiry (ATM IV 20.90%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a NEON bear put spread?
- The breakeven for the NEON bear put spread priced on this page is no defined breakeven on the modeled curve 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 NEON market-implied 1-standard-deviation expected move is approximately 5.99%; 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 NEON?
- Bear put spreads on NEON reduce the cost of a bearish NEON stock 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 NEON implied volatility affect this bear put spread?
- NEON ATM IV is at 20.90% with IV rank near 0.17%, 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.