Bull Call Spread

Description

Buying a lower-strike Call and selling a higher-strike Call.

Trading Logic

Moderately bullish. Reduces cost but caps maximum profit.

Practical Example

Stock at $100. Buy $100C ($5), sell $110C ($2). Net debit: $3.

P/L Curve

Chart Description
  • X-Axis: Stock price at expiration
  • Y-Axis: Expected P/L ($)
  • Green area: Profit; Red area: Loss