fence

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Fence

A position in which an investor is long (or short) on an out-of-the-money put, long (or short) on an opposite out-of-the-money call in addition to being long (or short) on the underlying asset. Both options have the same expiration date. A fence position sets a floor and ceiling for the underlying asset and limits potential losses for the investor. It is often used by traders in farm commodities.

fence

An investment position consisting of being long (or short) a stock or commodity, being long (or short) an out-of-the-money put, and being short (or long) an out-of-the-money call. Both options have the same expiration date.
References in periodicals archive ?
Bulgaria's National Company "Railway Infrastructure" (NKZI) is considering fencing off the railway line in the Sofia Roma-populated quarter "Fakulteta" in order to protect the trains from the immense amounts of trash there.
WELSH language campaigners have taken time out from the useful task of saving S4C to moan about a handful of English-only warning signs round temporary roadworks fencing off a collapsed sewer in Llansannan, Conwy.
When we are so irresponsible in the way we rent out jet skis to complete novices, or indeed the way we police our roads, to suggest fencing off beaches is simply daft.