Intracommodity spread
(redirected from Intra-Commodity Spread)Intracommodity spread
Intracommodity Spread
In futures contracts, the spread in which a trader buys a commodity future expiring in one month for a certain price, then sells a future for the same underlying commodity expiring a different month at the same time on the same exchange. Profit is determined by the price difference between the two contracts. The advantage of an intracommodity spread is that the trader does not need to rely on market movements in order to make a profit, but only needs his/her short position to have a higher price than the long position.