Bull Call Spread

### What is a Bull Call Spread, really? I use this one when I like a stock but I'm not betting the house on it. You buy a call near the money and immediately sell a call above it. That sold call brings in premium, which cuts down what you pay upfront. In exchange, you give up any profit beyond the higher strike. That's the trade — cheaper ticket, capped ceiling. Think of it as buying insurance-adjusted upside. You're not trying to catch the whole move; you're trying to catch a *piece* of it without bleeding theta the way a plain long call would. ### How to set it up 1. **Buy 1 Call** at a lower strike ($K_1$) — ATM or slightly ITM works well. 2. **Sell 1 Call** at a higher strike ($K_2$) — same expiry, no exceptions. ### The numbers - **Max Profit**: $(K_2 - K_1) - \text{Net Debit}$ - **Max Loss**: whatever you paid to enter (Net Debit) - **Breakeven**: $K_1 + \text{Net Debit}$ ### When I actually use this When I expect a steady, moderate climb — not a rocket, not a coin flip. IV should be on the lower side; if IV is already sky-high, both legs get expensive and the spread stops making sense. This is a "grind higher" trade, not a "gap up" trade.