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Bear call spread |
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Bear call spreadThe purchase of a call with a high strike price against the sale of a call with a lower strike price.The maximum profit is the net premium received (premium received - premium paid), while the maximum loss is calculated by subtracting the net premium received from the difference between the high strike price and the low strike price (high strike price - low strike price net premium received). A bear call spread should be entered when lower prices are expected.Similar MatchesSpread optionSpread optionA position consisting of the purchase of one option and the sale of another option on the same underlying security with a different exercise price and/or expiration date. Bid asked spreadBid asked spreadThe difference between the bid and the asked prices. Interdelivery spreadInterdelivery spreadUsed in futures or options market to refer the purchase of one month of a contract and selling another month in the same contract, in the hope that the price difference will widen or narrow, depending on the investment. SpreadSpread(1) The gap between bid and ask prices of a stock or other security. (2) The simultaneous purchase and sale of separate futures or options contracts for the same commodity for delivery in different months. Also known as a straddle. (3) Difference between the price at which an underwriter buys an issue from a firm and the price at which the underwriter sells it to the public. (4) The price an issuer pays above a benchmark fixed-income yield to borrow money. Box spreadBox spreadA four-sided option spread that involves a long call and a short put at one strike price as well as a short call and a long put at another strike price. Example: buying 1 XYZ May 60 call, and writing 1 XYZ May 65 call; simultaneously buying 1 XYZ May 65 put, and writing 1 May 60 put. Further SuggestionsYield spreadcrack spread Yield spread strategies condor spread backspread TED spread bull spread Dealers spread Spread income call spread Delta Spread diagonal spread Narrowing the spread bear spread NOB spread Put ratio backspread Selling the spread Bull spread spread Bid/ask spread Perpendicular spread Vertical spread Spread order Maturity spread Ratio Spread |
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