My textbook says the following for a bull call spread. "In the bull call spread, you sell a call with a lower strike price and buy a a call with a higher strike price. The call spread is a credit spread."

Isn't is the other way around? It's a debit spread right?

  • Debit/Credit depends on the premiums. With a bull/bear call spread, there are two legs. It is a credit if your premium gains are greater than cost to enter the position.
    – NuWin
    Commented Jul 27, 2018 at 5:45

2 Answers 2


Yes, the description you gave is reversed. Here is an example of a bull spread, one that I traded this year, which just expired successfully. One buys the lower strike, sells the higher, shifting the cost of the trade as well as the risk/reward. In this case, the stock closed at $94.32 at expiration. Only buying the $90 strike, the return would have been $14.32 or a 283% gain, the spread returned 400%.

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Yes, a bullish call spread is a debit spread. However, it is the opposite of what you have described. It is created by buying a call at a lower strike and selling a call at a higher strike price (same expiration).

Note that a synthetically equivalent bullish put spread can be created for a credit with the same strikes. The advantage to the put spread is that if you are correct in your assessment and the underlying rises, you may have fewer closing commissions (the puts expire worthless).

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