Seagull Spread

A seagull spread is an advanced three-leg strategy that enhances a traditional bull call spread by adding a short put component, creating a more capital-efficient bullish position with enhanced income generation. This strategy combines the directional bias of a bull call spread with the income benefits of a cash-secured put, making it ideal for traders with moderate bullish outlook who want to reduce the net cost of their position. The short put provides additional premium income but introduces assignment risk if the underlying falls below the put strike. The strategy performs best in moderately rising markets with declining volatility, where the short put expires worthless while the call spread captures upward movement. Professional traders use seagulls to optimize capital allocation while maintaining bullish exposure

If NIFTY is at ₹25,800, set up: Buy ₹25,800 Call for ₹120, Sell ₹26,200 Call for ₹60, Sell ₹25,400 Put for ₹40, creating ₹20 net debit with maximum profit of ₹380 if NIFTY closes at ₹26,200.