Call ratio spread
Buy one call and sell two higher: profit up to the short strike, open-ended risk above.
Neutral2 legsDebit
Illustrative: underlying at 100, strikes every 2.5, 45 days to expiry, implied volatility 25%, model prices. One lot = 100 shares.
Key figures
| Opens for | a debit of $19 |
|---|---|
| Max profit | +$481 |
| Max loss | Open-ended as the price rises |
| Break-evens | 100.19 and 109.81 |
| Position delta today | −11 shares |
| Outlook | Neutral |
The legs
| Action | Quantity | Option | Model price |
|---|---|---|---|
| Buy | 1 | 100 call, 45 days | 3.77 |
| Sell | 2 | 105 call, 45 days | 1.79 |
How it works
Buy one call and sell two higher: profit up to the short strike, open-ended risk above. Ratios and ladders sell more options than they buy, or the other way round. That lowers the cost but leaves one side with large or open-ended risk.
When it fits
It suits a view that the underlying stays within a range until expiry.
What can go wrong
The loss is open-ended if the price rises sharply, so position size and a plan for closing early matter. Short options can be assigned early, and a sharp fall with implied volatility rising can hurt more than the expiry line suggests, which is what the crash band shows.
Building it in Trident
In the Strategy Lab, choose call ratio spread and the days to expiry. Trident applies these strike rules to your live chain, prices each leg and draws the trade on the risk graph, where you can drag the days to expiry, change implied volatility or switch on the crash band. When it looks right, send it to order management; nothing reaches your broker until you send it.
Frequently asked questions
What is a call ratio spread?
Buy one call and sell two higher: profit up to the short strike, open-ended risk above.
What is the maximum loss on a call ratio spread?
It is open-ended if the price rises sharply.
Where does a call ratio spread break even?
With the underlying at 100 in this illustrative example, the break-even at expiry is 100.19 and 109.81.
Can I build a call ratio spread in Trident?
Yes. Pick it in the Strategy Lab and Trident chooses the strikes from your live chain, prices the legs and draws it on the risk graph.
Illustrative example with model prices, not a recommendation. Options carry risk of loss. See the risk disclosure.