These individual purchases, known as the legs of the spread, vary only in expiration date; they are based on the same underlying market and strike price.
In the typical version of this strategy, a rise in the overall implied volatility of a market's options during the trade will tend very strongly to be to the trader's advantage, and a decline in implied volatility will tend strongly to work to the trader's disadvantage.
This strategy will tend strongly to benefit from a decline in the overall implied volatility of that market's options over time.
However, when selecting the short strike, it is a good practice to always sell the shortest dated option available.
For traders who own calls or puts against a stock, they can sell an option against this position and "leg" into a calendar spread at any point.
However, once the short option expires, the remaining long position has unlimited profit potential.
Therefore, it is important to survey the condition of the overall market and to make sure you are trading within the direction of the underlying trend of the stock.
In summary, it is important to remember that a long calendar spread is a neutral – and in some instances a directional – trading strategy that is used when a trader expects a gradual or sideways movement in the short term and has more direction bias over the life of the longer-dated option.