Bull Call Spread¶
A bull call spread is a defined-risk options strategy where a trader buys a call at a lower strike price and sells a call at a higher strike price on the same underlying and expiration. The position costs a net debit, which is the maximum amount the trader can lose. Profit is capped at the difference between the two strikes minus the net debit.
HOW IT WORKS¶
The trader pays a net debit equal to the long call premium minus the short call premium. The position breaks even at expiration when the stock closes above the lower strike by the amount of the net debit. Maximum profit is reached when the stock closes at or above the higher strike at expiration. Both the maximum profit and maximum loss are fixed and known at entry.
| Metric | Formula |
|---|---|
| Net Debit | Long Call Premium − Short Call Premium |
| Breakeven | Lower Strike + Net Debit |
| Maximum Profit | (Higher Strike − Lower Strike) × 100 − Net Debit |
| Maximum Loss | Net Debit × 100 |
The strategy suits a moderately bullish outlook. The short call reduces the cost of the position and partially offsets time decay, but it also caps the upside beyond the higher strike.
IN TAPEBOARD¶
Tapeboard displays bull call spreads as a single position with net debit, breakeven, max profit, and max loss calculated automatically at the time of entry. The payoff diagram shows the full profit and loss curve across expiration prices. Traders can scan for bull call spread candidates using the spread screener, filtering by underlying, expiration, strike width, and net debit as a percentage of the spread width. P&L tracking updates in real time as the underlying moves.