Vertical Spread Calculator
Vertical spreads are among the most widely used options strategies because they offer defined risk and defined reward. By selecting spread type (bull call, bear call, bull put, bear put), entering the two strikes and the net premium, this calculator shows maximum profit, maximum loss, breakeven price, return on risk, and return on capital. A bull call spread profits when the stock rises; a bear call spread profits when the stock stays flat or falls. A bear put spread profits when the stock falls; a bull put spread profits when the stock stays flat or rises. All four strategies cap both risk and reward at the respective amounts computed here.
Vertical spread formula
Spread Width = upper strike - lower strike
Debit spread: Max Profit = (width - net debit) * 100; Max Loss = net debit * 100
Credit spread: Max Profit = net credit * 100; Max Loss = (width - net credit) * 100
Bull call / bear put breakeven = lower strike + net debit
Bear call breakeven = lower strike + net credit
Bull put breakeven = upper strike - net credit
Return on Risk = Max Profit / Max Loss
Choosing a vertical spread
- Bull call spreads: bullish view, limited cost, defined upside cap. Best in low-IV environments where options are cheap.
- Bear put spreads: bearish view, limited cost, defined downside cap. Similar profile to bull call but for falling stocks.
- Bear call spreads: neutral-to-bearish view, collect credit. Profit if stock stays below the short call strike.
- Bull put spreads: neutral-to-bullish view, collect credit. Profit if stock stays above the short put strike.
- Wider spreads increase both potential profit and risk; narrower spreads are cheaper but have lower maximum profit.
Frequently asked questions
What is a vertical spread?
A vertical spread involves buying and selling two options of the same type (both calls or both puts) with the same expiration but different strike prices. The position has defined maximum profit and maximum loss, making risk management straightforward.
What is a debit spread vs a credit spread?
A debit spread costs money to enter (you pay net premium). Examples: bull call spread, bear put spread. A credit spread collects money upfront. Examples: bear call spread, bull put spread. Debit spreads profit from favorable price moves; credit spreads profit from the stock staying away from the short strike.
How is max profit calculated for a debit spread?
For a debit spread: max profit = (spread width - net debit) * 100. The max profit is achieved when the stock closes at or beyond the long strike at expiration.
How is max profit calculated for a credit spread?
For a credit spread: max profit = net credit * 100. This is achieved when both options expire worthless (stock stays away from both strikes). Max loss = (spread width - net credit) * 100.
What is the breakeven of a bull call spread?
For a bull call spread (debit): breakeven = lower strike + net debit. For a bear put spread (debit): breakeven = higher strike - net debit. For credit spreads, breakeven = short strike minus (plus) net credit.
Official sources
- Options Clearing Corporation: theocc.com.
- CBOE Options Institute: cboe.com/education.
Reviewed by the CalculatorHub team, edited by James Graham, 15 June 2026. See our methodology.