Bear Call Credit Spread Calculator

A bear call credit spread sells a call and buys a higher-strike call on the same expiry. The credit received is the maximum gain, and the long call caps the loss at the strike width minus that credit. It profits if the stock stays below the short strike through expiry.

When it is used

Traders sell it when they expect a stock to stall below a resistance level, or when they want a bearish position that collects rather than pays premium. The defined risk is what separates it from a naked call. It is also the call half of an iron condor, and a common way to fade a rally that looks stretched.

How it makes and loses money

Profit comes from time passing and implied volatility falling, both of which shrink the short call faster than the long one. A rally hurts, and it hurts early, when the calls still have time value, even if the stock later settles below the strike. The loss is capped above the long strike.

What to check in the grid

The top rows show the loss flattening past the long strike; that flat line is the reason to buy the wing. Compare the early columns with expiry at the short strike to see how much of the credit is still at risk mid-trade, which is the usual trigger for closing at a portion of the maximum.