Which of the following statements about Bear Put Spread is true?

The Bear Put Spread is an options trading strategy that involves purchasing a put option at a higher strike price while simultaneously selling another put option at a lower strike price. This strategy is primarily used when investors anticipate a moderate decline in the price of the underlying asset.

The statement that this strategy is similar to the Bull Call Spread, but for puts, is accurate. In a Bull Call Spread, investors buy a call option at a lower strike price and sell another call option at a higher strike price, anticipating moderate upward movement in the asset's price. Conversely, the Bear Put Spread operates on similar principles, but it is structured for a bearish outlook, leveraging put options instead.

This similarity highlights the strategic nature of spread trading, where investors seek to limit risk and reduce costs while still achieving desired market exposure. By understanding the mechanics of both spreads, it becomes clear that they serve as counterpart strategies designed for opposite market conditions—bullish for calls and bearish for puts.