A call calendar sells a near-term call and buys a longer-term call at the same strike, profiting from faster decay of the front option. Multi-expiration, defined risk.
Open the Call Calendar Spread calculator →A call calendar sells a near-term call and buys a longer-term call at the same strike. The near option decays faster than the far one, so the spread profits from time passing while the stock sits near the strike.
Because the two legs expire on different dates, the payoff is not a simple straight line — at the near expiration the far call still holds time value, which is what creates the tent-shaped profit around the strike.
Maximum loss is the net debit paid, and the trade profits most if the stock is near the strike when the front option expires. A large move in either direction reduces the profit, as does a fall in implied volatility.
Calendars actually benefit from rising implied volatility, since the longer-dated leg gains more than the short one — making them a way to be long volatility and long theta at the same time.
Use the free OptionProfit Call Calendar Spread calculator to load a live option chain, build the trade, and instantly see the payoff chart, breakevens, probability of profit, Greeks and a Monte Carlo simulation of outcomes.
The near-term option you sold decays faster than the longer-term one you bought, so the spread gains value as time passes if the stock stays near the strike.
A large move away from the strike, or a drop in implied volatility, both of which reduce the value of your longer-dated long option relative to the trade.
Yes — the most you can lose is the net debit you paid to open the spread.
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