Strategy Overview
Medium RiskIntermediateBullish
A bull call spread is a debit spread that profits from upward movement. You buy a call at a lower strike and sell a call at a higher strike, reducing your cost and defining your maximum risk.
Max Profit
Width of spread - premium paid
Max Loss
Premium paid
Breakeven
Lower strike + premium paid
Probability
~45% win rate
hist. est.
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Example Setup Calculator
$
Debit Paid
$200
Max Profit
$300
Max Loss
$200
Breakeven
$102.00
Strategy Components
BUY ATM CALL
Buy ATM or slightly OTM call
SELL OTM CALL
Sell further OTM call
When to Use
- You expect the stock to rise moderately
- You want to reduce the cost of buying calls
- You want defined risk and reward
- IV is relatively high
Best Market Conditions
- Bullish trend identified
- Moderate to high IV
- Clear resistance levels for short strike
Best Practices
- Choose spread width based on expected move
- Target 30-60 DTE for time to be right
- Look for stocks with clear upside catalysts
- Consider closing at 50% profit
Ready to Trade?
Review Bull Call Spread and practice it in paper trading with the school workflow.
Paper Trading