How are O 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 O bear put spread priced from the end-of-day chain at a 30-day expiry (ATM IV 18.30%), the computed maximum profit is $197.50 per contract and the computed maximum loss is -$52.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a O bear put spread?

The breakeven for the O bear put spread priced on this page is roughly $59.48 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 O market-implied 1-standard-deviation expected move is approximately 5.25%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current O implied volatility affect this bear put spread?

O ATM IV is at 18.30% with IV rank near 50.23%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.

O Bear Put Spread Strategy

O (Realty Income Corporation), in the Real Estate sector, (REIT - Retail industry), listed on NYSE.

Realty Income, The Monthly Dividend Company, is an S&P 500 company dedicated to providing stockholders with dependable monthly income. The company is structured as a REIT, and its monthly dividends are supported by the cash flow from over 6,500 real estate properties owned under long-term lease agreements with our commercial clients. To date, the company has declared 608 consecutive common stock monthly dividends throughout its 52-year operating history and increased the dividend 109 times since Realty Income's public listing in 1994 (NYSE: O). The company is a member of the S&P 500 Dividend Aristocrats index. Additional information about the company can be obtained from the corporate website at www.realtyincome.com.

O (Realty Income Corporation) trades in the Real Estate sector, specifically REIT - Retail, with a market capitalization of approximately $57.37B, a trailing P/E of 49.67, a beta of 0.76 versus the broader market, a 52-week range of 54.52-67.94, average daily share volume of 6.0M, a public-listing history dating back to 1994, approximately 468 full-time employees. These structural characteristics shape how O stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.76 places O roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 49.67 is on the rich side, which tends to correlate with higher earnings-window IV expansion as the market debates whether forward growth supports the multiple. O pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a bear put spread on O?

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 O snapshot

As of May 15, 2026, spot at $61.25, ATM IV 18.30%, IV rank 50.23%, expected move 5.25%. The bear put spread on O 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 O specifically: O IV at 18.30% is mid-range versus its 1-year history, so strategy selection should anchor more to the directional thesis than to the IV regime, with a market-implied 1-standard-deviation move of approximately 5.25% (roughly $3.21 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 O expiries trade a higher absolute premium for lower per-day decay. Position sizing on O should anchor to the underlying notional of $61.25 per share and to the trader's directional view on O stock.

O bear put spread setup

The O 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 O near $61.25, the first option leg uses a $60.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed O 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 O shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Put	$60.00	$0.80
Sell 1	Put	$57.50	$0.28

O bear put spread risk and reward

Net Premium / Debit: -$52.50
Max Profit (per contract): $197.50
Max Loss (per contract): -$52.50
Breakeven(s): $59.48
Risk / Reward Ratio: 3.762

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.

O bear put spread payoff curve

Modeled P&L at expiration across a range of underlying prices for the bear put spread on O. 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%	+$197.50
$13.55	-77.9%	+$197.50
$27.09	-55.8%	+$197.50
$40.63	-33.7%	+$197.50
$54.18	-11.5%	+$197.50
$67.72	+10.6%	-$52.50
$81.26	+32.7%	-$52.50
$94.80	+54.8%	-$52.50
$108.34	+76.9%	-$52.50
$121.88	+99.0%	-$52.50

When traders use bear put spread on O

Bear put spreads on O reduce the cost of a bearish O stock position by selling a lower-strike put; suited to moderate-decline theses where price reaches but does not vastly exceed the short strike.

O thesis for this bear put spread

The market-implied 1-standard-deviation range for O extends from approximately $58.04 on the downside to $64.46 on the upside. A O bear put spread caps both the risk and the reward of a bearish position; relative to an outright long put on O, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current O IV rank near 50.23% is mid-range against its 1-year distribution, so the IV signal is neutral; the bear put spread thesis on O should anchor more to the directional view and the expected-move geometry. As a Real Estate name, O options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to O-specific events.

O 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. O positions also carry Real Estate sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move O alongside the broader basket even when O-specific fundamentals are unchanged. Long-premium structures like a bear put spread on O 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 O chain quotes before placing a trade.

Frequently asked questions

What is a bear put spread on O?: A bear put spread on O is the bear put spread strategy applied to O (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 O stock trading near $61.25, the strikes shown on this page are snapped to the nearest listed O chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are O 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 O bear put spread priced from the end-of-day chain at a 30-day expiry (ATM IV 18.30%), the computed maximum profit is $197.50 per contract and the computed maximum loss is -$52.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a O bear put spread?: The breakeven for the O bear put spread priced on this page is roughly $59.48 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 O market-implied 1-standard-deviation expected move is approximately 5.25%; 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 O?: Bear put spreads on O reduce the cost of a bearish O 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 O implied volatility affect this bear put spread?: O ATM IV is at 18.30% with IV rank near 50.23%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.