calendar spread


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Calendar spread

Applies to derivative products. A strategy in which there is a simultaneous purchase and sale of options of the same class at the same strike prices, but with different expiration date.

Time Spread

An options strategy in which an investor takes the same position in two different option contracts that are identical in every way except the expiration date. For example, an investor utilizing a time spread strategy may buy or write two puts on the same underlying asset at the same strike price; the only difference is that one of the puts has a longer expiration. A time spread allows the investor to profit from the difference in price on the underlying asset between the two expiration dates. It is also called a horizontal spread and a calendar spread.

calendar spread

In options and futures trading, the purchase of one contract and the sale of another contract that differs from the first only by its delivery or expiration date. An example of calendar spread would be the purchase of a December call with a strike price of $20 and the sale of a June call with the same strike price. An investor would use a calendar spread in order to profit from a change in the price difference as the securities move closer to maturity. Also called horizontal spread, time spread.
References in periodicals archive ?
Brent's six-month calendar spread has collapsed, despite the extension of production restraint by Saudi Arabia and its allies in the OPEC+ group and signs of a slowdown in new well drilling in the United States.
Flow noted last week included an opening buyer of 50K May 8/9 put spreads for a dime on Wednesday when shares were near $10.19, an opening buyer of 50K Apr 9.5 - Apr 26th 9.5 put 'stupids' for 23c on Thursday, and a calendar spread rolling 50K April 9.5 puts out to May 3rd on Friday.
ua Afull calendar spread across the city with two major Carnivals -- the Dubai Festival City Opening Weekend Carnival and the Burj Park Closing Weekend Carnival.
A Calendar Spread Trading Simulation of Seasonal Processing Spreads.
The calendar spread between June and December has shifted from a backwardation of 21 cents on Feb.
This structure brings benefits similar to those of an ordinary risk reversal, and adds the effect of a calendar spread. The trade's P&L profile will be more rounded than if the investor holds the underlying only, as in the event of a stock decline, the strategy will lose value much more slowly than the spot price.
Hilton Hotels saw a notable option trade this morning in which someone rolled the May 30 calls into the July 30 calls 11,500 times for a for a net debit of 90 cents for the calendar spread. Before the arm waving and boos to leave the stage for using jargon begin, here is breakdown of the transaction.
Both legs open and the calendar spread pays off if the stock holds $2 through the February expiration (or doesn't drop 14.1% over the next two weeks) but possibly falls below that level through mid-April.
In March and June 2015, Epoch traded in those futures contracts by dealing in 'calendar spread contracts' during a 'roll period' in the lead up to the expiration of the contracts.
The 30-day challenge promises a full calendar spread across the city with two major Carnivals -- the Dubai Festival City Opening Weekend Carnival and the Burj Park Closing Weekend Carnival.
The new position is long 54K Jan 5 puts against a Dec/Jan 6 calendar spread, possibly intended to help offset the cost of the puts.
The new range of precious metals products called LMEprecious will be launched in H1- 2017 and will include spot, daily and monthly futures, options and calendar spread contracts for gold and silver.