TARS Bull Call Spread Strategy
TARS (Tarsus Pharmaceuticals, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Tarsus Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, focuses on the development and commercialization of novel therapeutic candidates for ophthalmic conditions. Its lead product candidate is TP-03, a novel therapeutic that is in Phase III for the treatment of blepharitis caused by the infestation of Demodex mites, as well as to treat meibomian gland disease. The company is also developing TP-04 for the treatment of rosacea; and TP-05 for Lyme prophylaxis and community malaria reduction. In addition, the company develops lotilaner to address diseases across therapeutic categories in human medicine, including eye care, dermatology, and other diseases. Tarsus Pharmaceuticals, Inc. was incorporated in 2016 and is headquartered in Irvine, California.
TARS (Tarsus Pharmaceuticals, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $2.78B, a beta of 0.53 versus the broader market, a 52-week range of 38.51-85.25, average daily share volume of 617K, a public-listing history dating back to 2020, approximately 323 full-time employees. These structural characteristics shape how TARS stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.53 indicates TARS has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.
What is a bull call spread on TARS?
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 TARS snapshot
As of May 15, 2026, spot at $62.39, ATM IV 54.20%, IV rank 8.73%, expected move 15.54%. The bull call spread on TARS 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 63-day expiry.
Why this bull call spread structure on TARS specifically: TARS IV at 54.20% is on the cheap side of its 1-year range, which favors premium-buying structures like a TARS bull call spread, with a market-implied 1-standard-deviation move of approximately 15.54% (roughly $9.69 on the underlying). The 63-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated TARS expiries trade a higher absolute premium for lower per-day decay. Position sizing on TARS should anchor to the underlying notional of $62.39 per share and to the trader's directional view on TARS stock.
TARS bull call spread setup
The TARS 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 TARS near $62.39, the first option leg uses a $62.50 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed TARS chain at a 63-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 TARS shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $62.50 | $5.95 |
| Sell 1 | Call | $65.00 | $4.78 |
TARS bull call spread risk and reward
- Net Premium / Debit
- -$117.50
- Max Profit (per contract)
- $132.50
- Max Loss (per contract)
- -$117.50
- Breakeven(s)
- $63.68
- Risk / Reward Ratio
- 1.128
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.
TARS bull call spread payoff curve
Modeled P&L at expiration across a range of underlying prices for the bull call spread on TARS. 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% | -$117.50 |
| $13.80 | -77.9% | -$117.50 |
| $27.60 | -55.8% | -$117.50 |
| $41.39 | -33.7% | -$117.50 |
| $55.18 | -11.5% | -$117.50 |
| $68.98 | +10.6% | +$132.50 |
| $82.77 | +32.7% | +$132.50 |
| $96.57 | +54.8% | +$132.50 |
| $110.36 | +76.9% | +$132.50 |
| $124.15 | +99.0% | +$132.50 |
When traders use bull call spread on TARS
Bull call spreads on TARS reduce the cost of a bullish TARS stock position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.
TARS thesis for this bull call spread
The market-implied 1-standard-deviation range for TARS extends from approximately $52.70 on the downside to $72.08 on the upside. A TARS bull call spread caps both the risk and the reward of a bullish position; relative to an outright long call on TARS, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current TARS IV rank near 8.73% 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 TARS at 54.20%. As a Healthcare name, TARS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to TARS-specific events.
TARS 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. TARS positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move TARS alongside the broader basket even when TARS-specific fundamentals are unchanged. Long-premium structures like a bull call spread on TARS 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 TARS chain quotes before placing a trade.
Frequently asked questions
- What is a bull call spread on TARS?
- A bull call spread on TARS is the bull call spread strategy applied to TARS (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 TARS stock trading near $62.39, the strikes shown on this page are snapped to the nearest listed TARS chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are TARS 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 TARS bull call spread priced from the end-of-day chain at a 30-day expiry (ATM IV 54.20%), the computed maximum profit is $132.50 per contract and the computed maximum loss is -$117.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a TARS bull call spread?
- The breakeven for the TARS bull call spread priced on this page is roughly $63.68 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 TARS market-implied 1-standard-deviation expected move is approximately 15.54%; 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 TARS?
- Bull call spreads on TARS reduce the cost of a bullish TARS 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 TARS implied volatility affect this bull call spread?
- TARS ATM IV is at 54.20% with IV rank near 8.73%, 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.