When to use:
When you are mildly bearish on market direction.
A call bear spread is usually a credit spread. A credit spread is where the net cost of the position results in you receiving money up front for the trade. eg. you sell one Nifty 4000 call option (receive Rs 80) and the buy one Nifty 4200 call option (Rs. 50). The net effect is a credit of Rs 30.
This type of spread is used when you are mildly bearish on market direction. Same idea as the Call Bull Spread but reversed - i.e. you think the market will go down but think that the cost of a short stock or long put is too expensive.
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