Bull call spread strategy — how it works
A bull call spread is a defined-risk bullish strategy — buy a call and sell a higher call. Learn the payoff and how to build it.
A bull call spread is a defined-risk bullish strategy: you buy a call and sell a higher-strike call (same expiry). Selling the higher call reduces your cost, in exchange for capping your maximum profit.
The two legs
- Buy a call (lower strike) — your bullish bet
- Sell a call (higher strike) — collects premium, lowers cost
Payoff
- Max loss: the net premium paid (limited) — if the price stays below the lower strike.
- Max profit: the strike difference minus net premium — reached above the higher strike.
- Breakeven: lower strike + net premium.
When to use it
When you're moderately bullish — you expect a rise but want to spend less than a naked call and cap risk. Cheaper than buying a call outright, but the upside is capped.
How to build it
Open the Strategy Builder, add both legs (or use the template), check the payoff, and deploy. For the full walkthrough see the bull call spread guide.
FAQ
Why sell the higher call?
It collects premium that lowers your cost and breakeven — the trade-off is a capped maximum profit.
Is my risk limited?
Yes — the most you can lose is the net premium paid.
How is this different from buying a call?
Cheaper and lower-risk, but your profit is capped above the sold strike.