A strategy that buys a lower-strike call and sells a higher-strike call to profit from a moderate rise in the underlying.
A bull call spread is a limited-risk, limited-reward options strategy created by buying a call option at a lower strike price and simultaneously selling a call option at a higher strike price, both with the same expiry. It reduces the upfront cost compared to buying a call outright, in exchange for capping the maximum profit at the difference between the two strikes minus the net premium paid. It’s commonly used when a trader expects a moderate, rather than explosive, upward move.
Got a question or a feature you wish existed? Drop it in our Telegram community, the Stolo team is right there reading every message.