Bull spread an investor who is bullish about a stock, Financial Management

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Bull spread an investor who is bullish about a stock

(Bull Spread) An investor who is bullish about a stock (beleiving that it will rise) may wish to construct a bull spread for that stock. One way to construct such a spread is to buy a call with strike price K1 and sell a call with same expiration date but a strike price of K2 > K1, Draw the payoff curve of such a spread. Is the initial cost of the spread positive or negative

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Financial Management: Bull spread an investor who is bullish about a stock

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