An option trading strategy which involves selling a number of in-the-money calls at a set strike and simultaneously buying a larger number of out-of-the-money calls at a higher strike. For example, a 2×1 ratio call spread involves selling one call (short call) and buying two higher-strike calls. The ratio call spread is also known as a call backspread, a call ratio spread, or a ratio spread long call.
October 31, 2023
