Any spread in an options market in which the value of the spread will be increased by a decline in the price of the underlying asset.
One of a variety of strategies involving two or more options (or options combined with a position in the underlying stock) that can potentially profit from a fall in the price of the underlying stock.
The simultaneous writing of one call option with a lower strike price and the purchase of another call option with a higher strike price. Example: writing 1 XYZ May 60 call, and buying 1 XYZ May 65 call.
The simultaneous purchase of one put option with a higher strike price and the writing of another put option with a lower strike price. Example: buying 1 XYZ May 60 put, and writing 1 XYZ May 55 put.
1) The simultaneous purchase and sale of two futures contracts in the same or related commodities with the intention of profiting from a decline in prices but, at the same time, limiting the potential loss if this expectation is wrong. This can usually be accomplished by selling a nearby delivery and buying a deferred delivery. 2) A delta-negative options position comprised of long and short options of the same type, either calls or puts, designed to be profitable in a declining market. An option with a lower strike price is sold and one with a higher strike price is bought.
The simultaneous purchase of a put option with a higher striking price and sale of a put option with a lower striking price.
An option spread so designed that a profit will result if the underlying security declines in market value.
An option strategy designed to profit from a drop in a security's price, by selling a near-month futures contract and buying a deferred month futures contract. see also bull spread.
Short a nearby contract versus a long position in a deferred contract. Usually biased towards lower prices.
In relation to options markets, any spread in which a decline in the price of the underlying asset will theoretically increase the value of the spread. (Opposite of Bull Spread).
A spread that is put on with the expectation that the futures price will decline.
a combination of call options designed to profit from a rise in the price of the underlying security
an option strategy where a call is purchased and a call of a lower strike price on the same stock is sold
a strategy involving two or more options that will profit from a decrease in the price of the underlying asset
An option with an exercise price equal to the currency spot rate.
an option strategy designed to allow the trader to participate, with limited profit and limited risk, in the decline of a currency
An option spread (qv) of either puts (qv) or calls(qv) whereby the holder of the position benefits when prices fall.
An option strategy with maximum profit when the price of the underlying security declines. Maximum loss occurs if the underlying security rises in price. The strategy involves the purchase and simultaneous sale of options. Puts or calls can be used. A higher strike price is purchased and a lower strike price is sold. The options have the same expiration date.
Is an option strategy which is structured to profit from price declines in the underlying market. These spreads can be done for credits or debits. They can be built with calls or puts. When these strategies are done one-for-one, then the purchase of the higher strike and the sale of the lower strike establishes the bullish characteristic. Here, the common strategies are vertical, diagonal, and weighted spreads.
In most commodities and financial instruments, the term refers to selling the nearby contract month, and buying the deferred contract, to profit from a change in the price relationship.
An option position established by simultaneously buying and selling options in order to profit from a market price decline. One leg will profit from a decline in the underlying currency prices. The other leg of the option spread will profit if the underlying currency value unexpectedly increases.
An option strategy combining the purchase and sale of two puts (bear put spread) or two calls (bear call spread) with different strikes on the same underlying.
An option strategy wherein the investor profits when the underlying security's price declines. (Vs. Bull Spread). See: Bear; Bear Market Strategies; Bull Spread; Option Spread; Spread Position; Underlying Security
Sale of a near month futures contract against the purchase of a deferred month futures contract in expectation of a price decline in the near month relative to the more distant month. Example: selling a December contract and buying the more distant March contract.
A simultaneous sale of a nearby delivery month and purchase at a deferred delivery month fixed income future in expectation of short-term interest rates rising, thereby increasing the relative attractiveness of the back month contract.
A spread which is put on with the expectation that futures prices will decline.
Applies to derivative products. Strategy in the options market designed to take advantage of a fall in the price of a security or commodity, usually executed by buying a combination of calls and puts on the same security at different strike prices in order to profit as the security's price falls.
The simultaneous writing of one call option with a lower strike price and the purchase of another call option with a higher strike price. E.g.: Writing 1 XYZ Jan 50 call, and buying 1 XYZ Jan 55 call.
The simultaneous purchase of one put option with a higher strike price and the writing of another put option with a lower strike price. E.g.: Buying 1 XYZ Jan 55 put, and writing 1 XYZ Jan 50 put.
An option spread position in which the investor profits from a decline in the underlying stock price (vs. Bull Spread).
selling near term (Front) and simultaneously buying further out (Back) in order to take advantage of a potentially falling market in which, like all commodities markets, the change is more pronounced the nearer the time frame (opposite of Bull Spread).
Any spread in which a decline in the price of the underlying security will theor...
A spread composed by the simultaneous sale of a call option with a lower strike ...
A spread composed by the simultaneous purchase of a put option with a higher str...
A put spread.
Short the nearby future and long the deferred, in anticipation of a decline in the general level of prices, with the nearby future expected to decline more than the deferred contract.
An option strategy that makes its maximum profit when the underlying stock declines and has its maximum risk if the stock rises in price. The strategy can be implemented with either puts or calls. In either case, an option with a higher striking price is purchased and one with a lower striking price is sold, both options generally having the same expiration date. See also Bull Spread.
An option strategy executed with calls or puts that will profit if the value of the underlying stock rises.
Any option strategy that maximises profit from a decline in the underlying stock and has its maximum risk if the stock rises in price.
The bear spread is an option strategy that enables an investor to profit if the underlying security declines in value. See: Bull Spread
see Spread trading strategy.
The simultaneous purchase and sale of two futures contracts in the same or related commodities with the intention of profiting from a decline in prices but at the same time limiting the potential loss if this expectation does not materialize. In agricultural products, this is accomplished by selling a nearby delivery and buying a deferred delivery.
An example of a vertical spread, constructed by the purchase of a high strike call ( put) and the sale of a low strike call (put), both options being on the same underlying and having the same delivery month. Entered into when moderately bearish.