Long Call
Bullish StrategyUse Zuviz's free options visualizer to build this strategy instantly. The most basic bullish options strategy. Buy a call option to profit from upward price movement with limited downside risk.
⚡ Key Takeaways
- Market Outlook: Strongly bullish (expect significant upward movement)
- Max Profit: Unlimited (stock can rise indefinitely)
- Max Loss: Premium paid ($3.00 in example = $300/contract)
- Breakeven: Strike price + premium paid (e.g., $105 + $3 = $108)
- Best for: Leveraged bullish plays, earnings speculation, or limited capital scenarios
- Greeks Impact: Negative Theta (time decay hurts), positive Delta & Vega
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📊 Payoff Diagram
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🏗️ Strategy Structure
A Long Call is the simplest bullish options strategy - just one leg.
| Leg | Action | Type | Example Strike | Premium |
|---|---|---|---|---|
| 1 | Buy | Call | $105 | $3.00 |
Cost: $3.00 per share = $300 per contract
🧮 Key Calculations
Max Profit
Theoretically unlimited as the stock can rise indefinitely.
Max Profit = Unlimited (Stock Price - Strike - Premium)
Max Loss
Limited to the premium paid. Occurs if stock is at or below strike at expiration.
Max Loss = Premium Paid = $3.00/share ($300/contract)
Breakeven
Breakeven = Strike Price + Premium = $105 + $3.00 = $108.00
🎯 When to Use This Strategy
- Strongly bullish: You expect the stock to rise significantly
- Before earnings: Anticipating a positive surprise
- Takeover speculation: Expecting acquisition news
- Limited capital: Want stock exposure with less money at risk
- Leverage: Control 100 shares for fraction of cost
📈 Greeks Impact
Delta (Δ)
Positive (0.4-0.6 for ATM). Stock rises $1 = call rises ~$0.50.
Theta (Θ)
Negative - time decay works against you. Value erodes daily.
Vega (ν)
Positive - you benefit from rising volatility.
Gamma (Γ)
Positive - Delta increases as stock rises (your gains accelerate).
⚖️ Pros & Cons
Pros
- Unlimited profit potential
- Risk limited to premium
- Leverage - control 100 shares cheaply
- No margin required
- Simple to understand
Cons
- Time decay works against you
- Can lose 100% of investment
- Need significant move to profit
- IV crush hurts after events
- Expiration date limits time
📝 Real-World Example
Stock: AAPL trading at $150
Strategy: Buy $155 Call, 30 DTE, $4.00 premium
| Scenario | AAPL Price | Call Value | P&L |
|---|---|---|---|
| Stock crashes | $140 | $0.00 | -$400 |
| Stock flat | $150 | $0.00 | -$400 |
| Breakeven | $159 | $4.00 | $0 |
| Stock rises | $170 | $15.00 | +$1,100 |
| Stock moons | $200 | $45.00 | +$4,100 |