Building vertical spreads

A vertical spread involves buying one option and selling another at a different strike, same expiration. It reduces your net premium paid (debit spread) or collects a net credit (credit spread).

A bull call spread: buy a lower strike call, sell a higher strike call. Max profit is the difference in strikes minus net debit. Max loss is the net debit paid.

A bear put spread: buy a higher strike put, sell a lower strike put. These defined-risk structures let you express directional views with capped downside — ideal for beginners learning options mechanics.