Articles on Stock markets

News, Research and Analysis

Help Center
Introduction
Investment Portfolios
Investment Terminology and Instruments
Technical Analysis and TradingAnalysis BasicsTechnical IndicatorsTrading ModelsPatternsTrading OptionsTrading ForexTrading CommoditiesSpeculative Investments
Cryptocurrencies and Blockchain
Retirement
Retirement Accounts
Personal Finance
Corporate Basics
What is a bear call spread?

What is a bear call spread?

A bear call spread seeks to make money on the sale of call options but does not believe the underlying security will increase.

A Bear Call Spread strategy is utilized when one believes that the price of the underlying stock will go down (but not significantly) in the near future. It entails selling a call short at a lower price than you buy a long call, which is done to realize a net credit at the outset.

This is your maximum gain on this position. The long call is there to limit losses if the underlying stock goes up. As a limited gains/ limited loss position, it is a conservative play.

Keywords: portfolio management, bearish, call option, strike price, calls, options, conservative strategies, limited loss, limited profit,
What is an OTC Stock?What is intraday trading?What is adaptive selling?Who is a Bill Collector?What is a currency pair?What is technical analysis in trading?