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The bull call spread lowers the breakeven price on the trade, which would have been $21 with a long call alone, but is now just $20.50 with the spread strategy, or the net premium plus the long ...
In finance, a calendar spread (also called a time spread or horizontal spread) is a spread trade involving the simultaneous purchase of futures or options expiring on a particular date and the sale of the same instrument expiring on another date. These individual purchases, known as the legs of the spread, vary only in expiration date; they are ...
A box spread consists of a bull call spread and a bear put spread. The calls and puts have the same expiration date. The resulting portfolio is delta neutral. For example, a 40-50 January 2010 box consists of: Long a January 2010 40-strike call; Short a January 2010 50-strike call; Long a January 2010 50-strike put; Short a January 2010 40 ...
The iron condor is an advanced options strategy that combines a bear call spread (strategy No. 3) and a bull put spread (strategy No. 4). So it involves four separate legs, making it a complex ...
The calendar call spread (see calendar spread) is a bullish strategy and consists of selling a call option with a shorter expiration against a purchased call option with an expiration further out in time. The calendar call spread is basically a leveraged version of the covered call (see above), but purchasing long call options instead of ...
A short call is the reverse strategy to the long call. Every long call that’s purchased is also sold or “written” by another trader who thinks the option looks attractively priced. A short ...
It is often used to take a position on dividends or interest rates, or to profit from mispriced calendar spreads. [2] A jelly roll consists of a long call and a short put with one expiry date, and a long put and a short call with a different expiry date, all at the same strike price.
A covered call is a basic options strategy that involves selling a call option (or “going short” as the pros call it) for every 100 shares of the underlying stock that you own. It’s a ...