Calendar Spread vs Theta

An options strategy combining a bought longer-dated option and a sold shorter-dated option at the same strike; profits from the faster time decay of the short leg relative to the long leg; most effective in sideways regimes with elevated near-term volatility.

The rate of change of an option's price relative to the passage of one day, all else equal; always negative for bought options (time decay reduces value); always positive for sold options; accelerates as expiry approaches; measured in dollars lost per day from time decay.