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Bull call debit spread
BTO (buy to open) the lower call and STO (sell to open) the higher call. Close by reversing both tickets.
Two calls, same expiration: BTO (buy to open) the lower strike, STO (sell to open) the higher. You pay a net debit. Max loss is that debit. Max gain is the width minus the debit.
MSFT $420. BTO (buy to open) $420 call at $8, STO (sell to open) $440 call at $3. Debit $5. Break-even $425. Max gain $1,500. Max loss $500. Close as a pair.
The lab is that pair. Net delta is smaller than a lone long call. Slide through $425 and $440.
Teaching lab
Long lower call, short higher call
MSFT $420. BTO $420 at $8, STO $440 at $3. Debit $5. Greeks partly cancel.
- P/L / share
- +2.57
- ×100
- +257
- Delta
- +0.248
- Gamma
- 0.0019
- Theta / day
- -0.0403
- Vega / vol pt
- +0.0682
P/L / share
vs the lesson entry
Delta
share-equivalent
Gamma
peaks near the strikes
Theta / day
clock
Vega / vol pt
fear priced in
Rho / rate pt
small at 30 days
Max loss $500. Max gain $1,500. Break-even $425. Teaching only.
Try it: What if (teaching lab)
Tickets for this structure
BTO (buy to open) · STO (sell to open) · BTC (buy to close) · STC (sell to close). Illustrative fills only. We never send these orders.
BTO (buy to open)
Open a long
Buy to open (long call)
MSFT $420. BTO (buy to open) 1× 30-DTE (days to expiration) $420 call at $8.00 ($800). This is the rising leg.
STO (sell to open)
Open a short
Sell to open (short call)
STO (sell to open) 1× 30-DTE (days to expiration) $440 call at $3.00. Debit $5. Max gain $1,500. Max loss $500. BE $425.
STC (sell to close)
Close a long
Sell to close (long call)
STC (sell to close) the $420 with BTC (buy to close) the $440. Leave the short and you are naked the $440.
BTC (buy to close)
Close a short
Buy to close (short call)
BTC (buy to close) the $440 when you flatten. Opening is BTO (buy to open) + STO (sell to open). Closing is STC (sell to close) + BTC (buy to close).
One screen, two tickets
Opening a debit spread is BTO (buy to open) + STO (sell to open). Closing it is STC (sell to close) + BTC (buy to close). If a Positions note says “take profits,” that means the close pair, not a new BTO (buy to open).
How the Greeks move
Long lower call plus short higher call: net delta is positive but smaller, net theta and vega partly cancel. Slide the stock through $440: P/L (profit and loss) flattens at the cap. That is defined risk on a chart.
Checking for a quiz…
Teaching numbers only — not a live quote, not a fill, not financial advice. All lessons · Back to Practice · Replay · Journal.