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Spread, the difference in price between related securities, as in: Bid–offer spread, between the buying and selling price of a commodity and/or security; 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 blocks of option trading ...
In finance, a spread trade (also known as a relative value trade) is the simultaneous purchase of one security and 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 are sometimes used.
Peanut butter being spread on white bread . This is a list of spreads. A spread is a food that is literally spread, generally with a knife, onto food items such as bread or crackers. Spreads are added to food to enhance the flavour or texture of the food, which may be considered bland without it.
The simplest type of bid-ask spread is the quoted spread. This spread is taken directly from quotes, that is, posted prices. Using quotes, this spread is the difference between the lowest asking price (the lowest price at which someone will sell) and the highest bid price (the highest price at which someone will buy).
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 with different strike prices and the same expiration date. In this spread, the number of option contracts sold is not equal to a number of contracts bought.
In finance, the yield spread or credit spread is the difference between the quoted rates of return on two different investments, usually of different credit qualities but similar maturities. It is often an indication of the risk premium for one investment product over another. The phrase is a compound of yield and spread.
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.
A point spread is a range of outcomes and the bet is whether the outcome will be above or below the spread. As of 2006 [update] , spread betting was a major growth market in the UK , with the number of gamblers heading towards one million. [ 1 ]