Search

Nearby Terms

bull
bull spread
bull trap

bull spread

definition

An options strategy, in which an investor attempts to profit from a security's rising price by simultaneously buying a put and a call in the same investment. If the price moves up as expected, the trader will close out the put option and let the call option run, presumably taking a profit that exceeds the small loss taken on the put. Conversely, if the price moves down, the profit on the put will offset the loss on the call. Compare to Bear Spread; Straddle. See Box Spread.

Related Terms

 • leg  • bear spread  • hedge  • calendar spread  • straddle