bull spread

bull spread
In most commodities and financial instruments, the term refers to buying the nearby month, and selling the deferred month, to profit from the change in the price relationship. Chicago Board of Trade glossary
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The purchase of near month futures contracts against the sale of deferred month futures contracts in expectation of a price rise in the near month relative to the deferred. One type of bull spread, the limited risk spread, is placed only when the market is near full carrying charges.
See limited risk spread. The CENTER ONLINE Futures Glossary
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A spread strategy used in options and futures trading that is designed to capitalize on expected price appreciation. A bull spread using call options is created by buying a call option on an asset with a certain strike price and selling a call option on the same asset with a higher strike price (same expiration date). A bull spread with put options is created by buying a put option with a low strike and selling a put option with a high strike price (same expiration date). Less frequently, the bull spread is implemented by buying the nearby futures contract and selling the next out contract. Bloomberg Financial Dictionary
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A vertical spread involving the purchase of the lower strike call and the sale of the higher strike call, called a bull call spread. Also, a vertical spread involving the purchase of the lower strike put and the sale of the higher strike put, called a bull put spread. Chicago Mercantile Exchange Glossary
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An example of a vertical spread, constructed by the purchase of a low strike call ( call option) ( put ( put option)) and the sale of a high strike call ( put), both options being on the same underlying and having the same delivery month. Entered into when moderately bullish. Dresdner Kleinwort Wasserstein financial glossary
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An option position composed of both long and short options of the same type, either calls or puts, designed to be profitable in a declining market. An option with a lower strike price is bought and one with a higher strike price is sold. Exchange Handbook Glossary

Financial and business terms. 2012.

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