SCHI Bull Call Spread Strategy
SCHI (Schwab 5-10 Year Corporate Bond ETF), in the Financial Services sector, (Asset Management - Bonds industry), listed on AMEX.
The fund's goal is to track as closely as possible, before fees and expenses, the total return of an index that measures the performance of the intermediate-term U.S. corporate bond market.
SCHI (Schwab 5-10 Year Corporate Bond ETF) trades in the Financial Services sector, specifically Asset Management - Bonds, with a market capitalization of approximately $10.60B, a beta of 1.07 versus the broader market, a 52-week range of 22.08-23.278, average daily share volume of 3.0M, a public-listing history dating back to 2019. These structural characteristics shape how SCHI etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.07 places SCHI roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. SCHI pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a bull call spread on SCHI?
A bull call spread buys an at-the-money call and sells an out-of-the-money call at a higher strike for defined risk and defined reward bounded by the strike width.
Current SCHI snapshot
As of May 15, 2026, spot at $22.46, ATM IV 51.60%, IV rank 38.67%, expected move 14.79%. The bull call spread on SCHI below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 34-day expiry.
Why this bull call spread structure on SCHI specifically: SCHI IV at 51.60% is mid-range versus its 1-year history, so strategy selection should anchor more to the directional thesis than to the IV regime, with a market-implied 1-standard-deviation move of approximately 14.79% (roughly $3.32 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated SCHI expiries trade a higher absolute premium for lower per-day decay. Position sizing on SCHI should anchor to the underlying notional of $22.46 per share and to the trader's directional view on SCHI etf.
SCHI bull call spread setup
The SCHI bull call spread below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With SCHI near $22.46, the first option leg uses a $22.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed SCHI chain at a 34-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 SCHI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $22.00 | $1.62 |
| Sell 1 | Call | $24.00 | $0.81 |
SCHI bull call spread risk and reward
- Net Premium / Debit
- -$81.00
- Max Profit (per contract)
- $119.00
- Max Loss (per contract)
- -$81.00
- Breakeven(s)
- $22.81
- Risk / Reward Ratio
- 1.469
Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-call strike plus net debit.
SCHI bull call spread payoff curve
Modeled P&L at expiration across a range of underlying prices for the bull call spread on SCHI. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | -$81.00 |
| $4.97 | -77.8% | -$81.00 |
| $9.94 | -55.7% | -$81.00 |
| $14.90 | -33.6% | -$81.00 |
| $19.87 | -11.5% | -$81.00 |
| $24.83 | +10.6% | +$119.00 |
| $29.80 | +32.7% | +$119.00 |
| $34.76 | +54.8% | +$119.00 |
| $39.73 | +76.9% | +$119.00 |
| $44.69 | +99.0% | +$119.00 |
When traders use bull call spread on SCHI
Bull call spreads on SCHI reduce the cost of a bullish SCHI etf position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.
SCHI thesis for this bull call spread
The market-implied 1-standard-deviation range for SCHI extends from approximately $19.14 on the downside to $25.78 on the upside. A SCHI bull call spread caps both the risk and the reward of a bullish position; relative to an outright long call on SCHI, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current SCHI IV rank near 38.67% is mid-range against its 1-year distribution, so the IV signal is neutral; the bull call spread thesis on SCHI should anchor more to the directional view and the expected-move geometry. As a Financial Services name, SCHI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to SCHI-specific events.
SCHI bull call spread positions are structurally moderately bullish; the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. SCHI positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move SCHI alongside the broader basket even when SCHI-specific fundamentals are unchanged. Long-premium structures like a bull call spread on SCHI are particularly exposed to IV-crush risk through scheduled events (earnings, FDA decisions, central-bank meetings) where IV typically contracts post-event regardless of the directional outcome. Always rebuild the position from current SCHI chain quotes before placing a trade.
Frequently asked questions
- What is a bull call spread on SCHI?
- A bull call spread on SCHI is the bull call spread strategy applied to SCHI (etf). The strategy is structurally moderately bullish: A bull call spread buys an at-the-money call and sells an out-of-the-money call at a higher strike for defined risk and defined reward bounded by the strike width. With SCHI etf trading near $22.46, the strikes shown on this page are snapped to the nearest listed SCHI chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are SCHI bull call spread max profit and max loss calculated?
- Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-call strike plus net debit. For the SCHI bull call spread priced from the end-of-day chain at a 30-day expiry (ATM IV 51.60%), the computed maximum profit is $119.00 per contract and the computed maximum loss is -$81.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a SCHI bull call spread?
- The breakeven for the SCHI bull call spread priced on this page is roughly $22.81 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current SCHI market-implied 1-standard-deviation expected move is approximately 14.79%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a bull call spread on SCHI?
- Bull call spreads on SCHI reduce the cost of a bullish SCHI etf position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.
- How does current SCHI implied volatility affect this bull call spread?
- SCHI ATM IV is at 51.60% with IV rank near 38.67%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.