Long Call

The structure

A Long Call (Long Call) is the simplest bullish position: one contract that gives you the right to buy 100 shares at the strike price until expiration. The cost is the full contract premium, and that is also the most you can lose however far the stock falls.

When to use it

Used when the view is a clear rise over a set period and you want limited-loss leverage instead of buying the full stock. It gets more attractive when Implied Volatility is relatively low, since the right is then bought cheaply.

Maximum profit and loss

Profit is theoretically unlimited as the stock rises, and the loss is capped at the premium. The breakeven point at expiration is the strike price plus the premium. Before expiration you can exit at whatever value the contract still holds.

Hypothetical example

A stock at $100 and a one-month call with a $105 strike and a $2 premium: breakeven is $107. The stock reaches $115 before expiration: intrinsic value is $10 and the profit is about four times the premium. It stays below $105: you lose the full $200, but no more.

Common mistake

Chasing far out-of-the-money contracts near expiry because they are cheap: the tiny chance of paying off is the reason for the low price, and theta eats them faster than the idea can play out. Enough time and a reasonably close strike cost more, and they are more honest.

When an outright purchase fits best

Three things need to line up: you expect a big, fast move rather than a slow trend, implied volatility is cheap against its own history, and the expiry gives the idea more time than it needs. Without all three, a debit spread is the wiser choice because it softens both theta and volatility crush.

Where to see it on the platform

The options calculator works out its price, Greeks and breakeven, and the Greeks page draws its profit-and-loss curve at expiration.

The calculator works out its breakeven and decay curve, and the strategy guide compares the two families on your inputs.