A credit spread option which gives the holder the right, but not the obligation, to sell a defaultable reference bond at a preset strike credit spread over a default-free comparable bond (such as Treasury bonds). This option allows investors to capitalize on or hedge against downward changes in credit spreads.

It is also possible by this option to trade forward credit spread downward expectations separately from interest rate movements. Furthermore, a credit spread put can also be used to protect portfolios against having to sell underperforming assets at distressed prices.