A volatility spread (specifically a time spread) that involves selling a far-month option and buying a near-month option where all options are of the same type (all calls or all puts) and have the same strike price. For example, an investor may long 25 April 100 puts and short 25 July 100 puts.
Derivatives
Derivatives have increasingly become very important tools in finance over the last three decades. Many different types of derivatives are now traded actively on ...
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