Bull Call Spread

A bull call spread (also called a call debit spread) is a vertical spread strategy used when a trader expects a moderate rise in the underlying asset. The strategy involves buying a call option at a lower strike price and simultaneously selling a call option at a higher strike price, both with the same expiration date. The net cost (debit) is the maximum potential loss, while the maximum profit is the difference between the strike prices minus the premium paid. This strategy is more cost-effective than buying a call outright because the premium received from the short call partially offsets the cost of the long call. It is one of the most popular and straightforward directional options strategies.