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Hi ksubash -

When you’re executing a bull call spread, the long call covers the short call, so it should be treated at most brokers similarly to as if you were writing a simple covered call on shares you own.

Note that there is a chance that the short call gets assigned, which would leave you long the calls and short the shares. In that situation, if you don’t have sufficient margin permissions (such as if you’re trading in an IRA) or margin balance (such as if the stock skyrocketed against your short call), you would be required to close the short stock position, but you could either sell or exercise the long call position to come up with the cash to do so.

Discovery/HR Home Fool
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