How are CARG 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 CARG bull call spread priced from the end-of-day chain at a 30-day expiry (ATM IV 41.10%), the computed maximum profit is $122.50 per contract and the computed maximum loss is -$77.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a CARG bull call spread?

The breakeven for the CARG bull call spread priced on this page is roughly $34.78 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 CARG market-implied 1-standard-deviation expected move is approximately 11.78%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current CARG implied volatility affect this bull call spread?

CARG ATM IV is at 41.10% with IV rank near 25.68%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.

CARG Bull Call Spread Strategy

CARG (CarGurus, Inc.), in the Consumer Cyclical sector, (Auto - Dealerships industry), listed on NASDAQ.

CarGurus, Inc., established in Boston, Massachusetts, in 2005, manages a prominent online ecosystem for vehicle transactions, serving both buyers and sellers across the United States and internationally. The company's operations are divided into two main segments: the U.S. Marketplace and Digital Wholesale. Essentially, CarGurus offers an expansive digital automotive marketplace where individuals can search for new and pre-owned vehicle listings from numerous dealerships. Simultaneously, it empowers dealers by linking them with a vast, engaged consumer base and supplying them with practical, data-driven market intelligence. The platform provides an array of specialized features to simplify the car buying and selling journey.

CARG (CarGurus, Inc.) trades in the Consumer Cyclical sector, specifically Auto - Dealerships, with a market capitalization of approximately $3.19B, a trailing P/E of 20.84, a beta of 1.21 versus the broader market, a 52-week range of 26.39-39.42, average daily share volume of 1.3M, a public-listing history dating back to 2017, approximately 1K full-time employees. These structural characteristics shape how CARG stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.21 places CARG roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.

What is a bull call spread on CARG?

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 CARG snapshot

As of June 30, 2026, spot at $33.97, ATM IV 41.10%, IV rank 25.68%, expected move 11.78%. The bull call spread on CARG 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 17-day expiry.

Why this bull call spread structure on CARG specifically: CARG IV at 41.10% is on the cheap side of its 1-year range, which favors premium-buying structures like a CARG bull call spread, with a market-implied 1-standard-deviation move of approximately 11.78% (roughly $4.00 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated CARG expiries trade a higher absolute premium for lower per-day decay. Position sizing on CARG should anchor to the underlying notional of $33.97 per share and to the trader's directional view on CARG stock.

CARG bull call spread setup

The CARG 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 CARG near $33.97, the first option leg uses a $34.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CARG chain at a 17-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 CARG shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$34.00	$1.25
Sell 1	Call	$36.00	$0.48

CARG bull call spread risk and reward

Net Premium / Debit: -$77.50
Max Profit (per contract): $122.50
Max Loss (per contract): -$77.50
Breakeven(s): $34.78
Risk / Reward Ratio: 1.581

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.

CARG bull call spread payoff curve

Modeled P&L at expiration across a range of underlying prices for the bull call spread on CARG. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$77.50
$7.52	-77.9%	-$77.50
$15.03	-55.8%	-$77.50
$22.54	-33.6%	-$77.50
$30.05	-11.5%	-$77.50
$37.56	+10.6%	+$122.50
$45.07	+32.7%	+$122.50
$52.58	+54.8%	+$122.50
$60.09	+76.9%	+$122.50
$67.60	+99.0%	+$122.50

When traders use bull call spread on CARG

Bull call spreads on CARG reduce the cost of a bullish CARG stock position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.

CARG thesis for this bull call spread

The market-implied 1-standard-deviation range for CARG extends from approximately $29.97 on the downside to $37.97 on the upside. A CARG bull call spread caps both the risk and the reward of a bullish position; relative to an outright long call on CARG, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current CARG IV rank near 25.68% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on CARG at 41.10%. As a Consumer Cyclical name, CARG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CARG-specific events.

CARG 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. CARG positions also carry Consumer Cyclical sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move CARG alongside the broader basket even when CARG-specific fundamentals are unchanged. Long-premium structures like a bull call spread on CARG 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 CARG chain quotes before placing a trade.

Frequently asked questions

What is a bull call spread on CARG?: A bull call spread on CARG is the bull call spread strategy applied to CARG (stock). 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 CARG stock trading near $33.97, the strikes shown on this page are snapped to the nearest listed CARG chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are CARG 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 CARG bull call spread priced from the end-of-day chain at a 30-day expiry (ATM IV 41.10%), the computed maximum profit is $122.50 per contract and the computed maximum loss is -$77.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a CARG bull call spread?: The breakeven for the CARG bull call spread priced on this page is roughly $34.78 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 CARG market-implied 1-standard-deviation expected move is approximately 11.78%; 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 CARG?: Bull call spreads on CARG reduce the cost of a bullish CARG stock 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 CARG implied volatility affect this bull call spread?: CARG ATM IV is at 41.10% with IV rank near 25.68%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.