Call Ratio Backspread
Explosive upside, capped mid-range risk
Sell one ATM call, buy two further OTM calls — small defined risk in the middle, real profit if spot runs hard, without a straddle's full cost.
Payoff at expiry
Illustrative · NIFTY @ 25000Max Profit
Unlimited
Max Loss
₹7,500
Breakeven
25000 / 25200
How it's built
Sell one ATM call and buy two calls two strikes higher, same expiry — net long two calls against one short, usually for a small net credit or close to zero cost depending on the smile.
When to deploy it
You want convex, open-ended upside exposure like a long call, but you're willing to accept a defined loss zone in the middle of the range — where the short call's cost outpaces the two long calls — in exchange for cutting the net premium outlay versus buying two naked calls.
Worked example
Say NIFTY is trading around 25,000 with a few sessions left before expiry. You sell the 25000 call for ₹180, and you buy the 2x 25100 call for ₹90 — a net credit of ₹0 for one lot of 75.
At expiry, the position is worth the most once NIFTY is on the right side of 25000 or 25200 — up to an amount that keeps growing the further it runs, with no cap. Move against that line instead and the worst case is capped at ₹7,500 per lot, not open-ended.
Mistakes that break this strategy
- Ignoring the "dead zone" between the short strike and the long strikes, where the position can lose more than either a single long call or doing nothing at all.
- Sizing the short leg 1:1 without checking whether the resulting position is a net credit or a net debit — that changes the whole risk picture.
- Deploying this as a default bullish trade rather than reserving it for real conviction that a move, if it comes, comes hard and fast.
More bullish strategies
See it read live, not just diagrammed
Quantum Horizon reads Aegis/Zenith wall migration and RRG rotation live across NIFTY, BANKNIFTY, FINNIFTY and MIDCPNIFTY — sign in and watch it work in Paper mode.