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Spread option information


In finance, a spread option is a type of option where the payoff is based on the difference in price between two underlying assets. For example, the two assets could be crude oil and heating oil; trading such an option might be of interest to oil refineries, whose profits are a function of the difference between these two prices. Spread options are generally traded over the counter, rather than on exchange.[1][2]

A 'spread option' is not the same as an 'option spread'. A spread option is a new, relatively rare type of exotic option on two underlyings, while an option spread is a combination trade: the purchase of one (vanilla) option and the sale of another option on the same underlying.

  1. ^ Global Derivatives: Spread option
  2. ^ Investopedia:Spread option

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Spread option

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In finance, a spread option is a type of option where the payoff is based on the difference in price between two underlying assets. For example, the two...

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Options strategy

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traded). Butterfly - a neutral option strategy combining bull and bear spreads. Long butterfly spreads use four option contracts with the same expiration...

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Spread offense

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to cover the entire field from sideline to sideline. Many spread teams use the read option running play to put pressure on both sides of the defense....

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Bull spread

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In options trading, a bull spread is a bullish, vertical spread options strategy that is designed to profit from a moderate rise in the price of the underlying...

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Option offense

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based on option-based systems are the foundation of the modern spread offense attack. An option offense is any football scheme that relies on option running...

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Spread

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Credit spread (bond), on bonds Option-adjusted spread, on mortgage backed securities where the borrower has the right to repay in full Options spread, building...

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Bear spread

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In options trading, a bear spread is a bearish, vertical spread options strategy that can be used when the options trader is moderately bearish on the...

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Box spread

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In options trading, a box spread is a combination of positions that has a certain (i.e., riskless) payoff, considered to be simply "delta neutral interest...

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Yield spread

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spread relative to a benchmark yield curve, including interpolated spread (I-spread), zero-volatility spread (Z-spread), and option-adjusted spread (OAS)...

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Debit spread

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a debit spread, a.k.a. net debit spread, results when an investor simultaneously buys an option with a higher premium and sells an option with a lower...

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Rich Rodriguez

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"Football 101: Mountaineers spread the wealth". Retrieved October 18, 2006. May, Tim. "College football: Spread option remains in vogue". Retrieved August...

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Exotic option

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a digital option, peroni options, range options, spread options, etc.) It could depend on more than one index, such as in basket options, outperformance...

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Binary option

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option is a financial exotic option in which the payoff is either some fixed monetary amount or nothing at all. The two main types of binary options are...

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Spread trade

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sale of a related security, called legs, as a unit. Spread trades are usually executed with options or futures contracts as the legs, but other securities...

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Real options valuation

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Real options valuation, also often termed real options analysis, (ROV or ROA) applies option valuation techniques to capital budgeting decisions. A real...

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Credit spread

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Credit spread may refer to: Credit spread (option) Credit spread (bond) This disambiguation page lists articles associated with the title Credit spread. If...

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Vertical spread

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In options trading, a vertical spread is an options strategy involving buying and selling of multiple options of the same underlying security, same expiration...

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Wildcat formation

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offensive philosophy. It can be a part of many offenses. For example, a spread-option offense might use the wildcat formation to confuse the defense, or a...

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Calendar spread

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calendar spread (also called a time spread or horizontal spread) is a spread trade involving the simultaneous purchase of futures or options expiring...

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Ratio spread

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A Ratio spread is a, multi-leg options position. Like a vertical, the ratio spread involves buying and selling options on the same underlying security...

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Diagonal spread

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the term diagonal spread is applied to an options spread position that shares features of both a calendar spread and a vertical spread. It is established...

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