Bullish Options Strategies
In this module, we'll show you how to create specific strategies that profit from up trending markets, including low IV strategies like calendars, diagonals, covered calls, and directional debit spreads.
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Call Calendar Spread

A call calendar spread is a multi-leg, risk-defined strategy with unlimited profit potential. Call calendar spreads are neutral to bearish short-term and slightly bullish long-term.
Call Calendar Spread
Kirk Du Plessis
Apr 19, 2021

Long call calendar spreads profit from a slightly higher move up in the underlying stock in a given range. They also profit from a rise in implied volatility and are therefore a low-cost way of taking advantage of low implied volatility options. Calendar spreads lose if the underlying moves too far in either direction. The maximum loss is the debit paid, until the option you sold expires. After that, you are long an option and your remaining risk is the entire value of that option. Options in near-month expirations have more time decay than later months because they have a higher theta. The calendar spread profits from this difference in decay rates. This trade is best used when implied volatility is low and when there is an implied volatility "skew" between the months used, specifically when the near-month option sold has a higher implied volatility than the later-month option bought.

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Put Diagonal Spread
A put diagonal spread is a multi-leg, risk-defined, bullish strategy with limited profit potential. A put diagonal spread is entered when an investor believes the stock price will be neutral or bullish short-term.

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Call Calendar Spread

A call calendar spread is a multi-leg, risk-defined strategy with unlimited profit potential. Call calendar spreads are neutral to bearish short-term and slightly bullish long-term.
Call Calendar Spread
Kirk Du Plessis
Apr 19, 2021

Long call calendar spreads profit from a slightly higher move up in the underlying stock in a given range. They also profit from a rise in implied volatility and are therefore a low-cost way of taking advantage of low implied volatility options. Calendar spreads lose if the underlying moves too far in either direction. The maximum loss is the debit paid, until the option you sold expires. After that, you are long an option and your remaining risk is the entire value of that option. Options in near-month expirations have more time decay than later months because they have a higher theta. The calendar spread profits from this difference in decay rates. This trade is best used when implied volatility is low and when there is an implied volatility "skew" between the months used, specifically when the near-month option sold has a higher implied volatility than the later-month option bought.

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Next lesson
Put Diagonal Spread
A put diagonal spread is a multi-leg, risk-defined, bullish strategy with limited profit potential. A put diagonal spread is entered when an investor believes the stock price will be neutral or bullish short-term.
Bullish Options Strategies
In this module, we'll show you how to create specific strategies that profit from up trending markets, including low IV strategies like calendars, diagonals, covered calls, and directional debit spreads.
Lesson
7
of
12
Next Lesson
Lessons
Exit Course