Bear Spread

1. An option strategy seeking maximum profit when the price of the underlying security declines. The strategy involves the simultaneous purchase and sale of options; puts or calls can be used. A higher strike price is purchased and a lower strike price is sold. The options should have the same expiration date.

2. A trading strategy used by futures traders who intend to profit from the decline in commodity prices while limiting potentially damaging losses.

Investopedia Says:
1. You make money if the underlying goes down and lose if the underlying rises in price.

2. A bear spread is created through the simultaneous purchase and sale of two of the same or closely related futures contracts. This is accomplished in the agricultural commodity markets by selling a future and offsetting it by purchasing a similar contract with an extended delivery date.

Related Links:
For those who are new to futures but want a solid understanding of them, this tutorial explains what futures contracts are, how they work and why investors use them. Futures Fundamentals
This trading strategy is an excellent limited-risk strategy that can be used with equity as well as commodity and futures options. Vertical Bull and Bear Credit Spreads
An introduction to the world of options, covering everything from primary concepts to how options work and why you might use them. Options Basics Tutorial

Strategy in the options market designed to take advantage of a fall in the price of a security or commodity. Someone executing a bear spread could buy a combination of calls and puts on the same security at different strike prices in order to profit as the security's price fell. Or the investor could buy a put of short maturity and a put of long maturity in order to profit from the difference between the two puts as prices fell. See also Bull Spread.