Also known as the Poor Man's Covered Call. Buy a long-dated deep ITM call to act as your 'stock replacement,' then sell short-dated OTM calls against it every few weeks to collect income.
Bullish Diagonal Spread is a uptrend (bullish) options trading strategy (2 legs) engineered for limited risk profiles in low iv (long option) / high iv (short option) market environments.
Width between Strikes + Short Call Expiration Value - Net Debit
Net Debit Paid
Long Strike + Net Premium Paid
| Action | Contract Type | Strike Selection | Quantity |
|---|---|---|---|
| BUY | CALL | Deep ITM (Far Expiration) | 1x |
| SELL | CALL | OTM (Near Expiration) | 1x |
You're bullish, but you don't want to pay full price for a naked call and you're okay capping your profit in exchange for cheaper entry. Buy one call, sell a higher one to fund it — simple as that.
🔼 Uptrend (Bullish)This is the trade for when you think a stock is about to make an explosive move up — not just drift higher. Sell one call near the money, buy two further out. Cheap or even free to put on, and it pays big if the move actually happens.
🔼 Uptrend (Bullish)The first trade every options trader learns, and honestly still one of the best when you're genuinely convinced a stock is going up. You risk only what you pay, and there's no ceiling on the upside.
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