Calendar Spread - Debit
Options strategy · Level 3 · Spreads & short options
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Sell a near-term option and buy a longer-term option at the same strike. The near one decays faster, so you earn the difference in theta.
Where Tradecraft teaches it
Level 3 · Spreads & short options, in the lesson “Calendars, diagonals & the poor man's covered call”: Time spreads: why they are long vega and positive theta, the PMCC, and legging risk.
Related terms
- Diagonal Spread - Short leg expires firstSell a near-term option and buy a longer-term one at a different strike — part calendar, part vertical.
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