Strategy Overview
Medium RiskAdvancedNeutralBullish
A jade lizard combines a short put with a short call spread (bear call spread). When structured correctly, it has no upside risk while collecting premium from both sides.
Max Profit
Total premium received
Max Loss
Put strike - total premium (downside only)
Breakeven
Short put strike - total premium received
Probability
~70% win rate
hist. est.
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Example Setup Calculator
$
Credit Received
$400
Max Profit
$400
Max Loss
Unlimited
Breakeven
$96.00 / $104.00
Strategy Components
SELL OTM PUT
Sell OTM put for credit
SELL OTM CALL
Sell OTM call for credit
BUY OTM CALL
Buy further OTM call for protection
When to Use
- You are neutral to bullish and want income
- You want to eliminate upside risk
- IV is elevated for better premiums
- You want undefined risk only on one side
Best Market Conditions
- High IV rank
- Neutral to bullish outlook
- Want one-sided risk
Best Practices
- Ensure total credit > call spread width to eliminate upside risk
- Target 30-45 DTE
- Manage at 50% of max profit
- Only take on risk to the downside
Ready to Trade?
Review Jade Lizard and practice it in paper trading with the school workflow.
Paper Trading