Bull Call Spread
A bull call spread buys a call and sells a higher-strike call with the same expiry — a defined-risk, defined-reward bet that the underlying rises moderately.
- Max profit
- 600
- Max loss
- -400
- Breakeven(s)
- 104.0
When to use
Use it when you are moderately bullish and want to cap cost by giving up upside beyond the short strike. Cheaper than a naked long call because the short call offsets premium.
Risk profile
Risk is limited to the net debit paid; reward is limited to the strike width minus the debit. Both are fully known at entry — no margin surprise.
FAQ
What is the maximum loss on a bull call spread?
The most you can lose is the net premium (debit) you pay to open the spread, which happens if the underlying finishes at or below the long call strike at expiration.
When does a bull call spread reach maximum profit?
Maximum profit is reached at expiration when the underlying is at or above the short (higher) call strike; profit equals the strike width minus the net debit.
What is the breakeven of a bull call spread?
Breakeven at expiration is the long call strike plus the net debit paid. For example, buying the 100 call and selling the 110 call for a $4 net debit gives a $104 breakeven.