Bear Call Spread
The bear call spread is a bearish options strategy that involves selling a call option while simultaneously buying another call option with a higher strike price. This strategy profits when the underlying asset's price remains below the strike price of the call option sold.
Key Points:
- Sell a call option with a lower strike price.
- Buy a call option with a higher strike price.
- Both options have the same expiration date.
- Limited profit and risk is limited but higher than the profit.
- Used when the investor expects a decline or no change in the underlying asset's price.