Ratio Spread

(redirected from Ratio spreads)

Ratio Spread

Constructed with either puts or calls, the strategy consists of buying a certain amount of options and then selling a larger quantity of more out-of-the-money options.

Ratio Spread

An option strategy that involves buying a certain number of option contracts and selling a different number (according to a stated ratio) of options on the same underlying asset with the same expiration date but with a different strike price. One hopes to profit from the change in price of the underlying asset over the life of the options, but a ratio spread is most useful when one does not expect the price to be volatile.
Mentioned in ?
References in periodicals archive ?
Trade appears to bring the total open interest at the June21 5 puts to nearly 200K contracts, all of which were opened last week in similar ratio spreads selling the long-dated 5 strike puts against slightly shorter in-the-money long put positions, including a buy of 12K Jan 10 puts vs sale of 49K June21 5 puts on June 6th, and another 20K Jan 7.5 puts vs 40400 June21 5 puts for 1.25 on June 7th.
The overall ratio spreads, OAR, that were produced from the combinations of launch and top gear ratios are summarized in Table 2, ranging from 6.92 to 10.00.
With Royston Drenthe in the side Everton have scored every 36 minutes this season, without him, that ratio spreads to 149 minutes.
The application's strategies include basis trades, curve trades, 'butterflies' and ratio spreads tailored specifically to commodity and financial futures.
After a chapter on basic concepts and vocabulary, the workbook explains puts and calls, the covered call, and directional and nondirection dependent strategies, and looks at volatility, ratio spreads and backspreads, and current technology available to professional options traders.
-- Autospreader and Autotrader additions: Autospreader gives traders more control by providing them with the ability to dynamically freeze and unfreeze their working orders, adjust their payup ticks on the fly, create ratio spreads and display their spread prices in fractions.
The 2X3 diagonal spread appears to roll short puts to Jan21, down 2.5 strikes, and is similar to ratio spreads that printed Monday, with open interest numbers showing 5.5K Jan 10 puts closed and 15K Jan21 7.5 puts opened.
Ratio spreads in Signet Jewelers as a bullish position is adjusted.
Ratio spreads in Ebay as bullish positions are adjusted.
Ratio spreads in Schlumberger as a bullish play is adjusted.
Ratio spreads in Marriott as a defensive position is adjusted.
Far downside put ratio spreads in PG&E March contracts.