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Hello Andrew, A type of options spread in which a trader holds more long positions than short positions. The premium collected from the sale of the short option is used to help finance the purchase of the long options. This type of spread enables the trader to have significant exposure to expected moves in the underlying asset while limiting the amount of loss in the event prices do not move in the direction the trader had hoped for. This spread can be created using either all call options or all put options. An example of a backspread using call options would be selling one $45 call option for $5 and purchasing two $50 call options for $2.10 each. The trader in this case would benefit from a large move past $50 because he/she is holding more long options than short. |
List of Gurus
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Heng Kim 2019-09-24 03:46:59
Hi PrettyWoman, The job market is the market in which employers search for
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Chaoxiang Lee 2019 - 09 - 07
Hi Maria, A caplet is a kind of call option based on interest rates. The
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Apinya Kamon 2018 - 03 - 29
Hello Maria, A large trader is an investor or organization with trades that
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Heng Kim 2015 - 10 - 01
Hello Fluffy, A speculative options trading strategy that consists of
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Heng Kim 2017 - 07 - 24
Hi Fluffy, In technical analysis, a false signal refers to an indication of
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Heng Kim 2019 - 09 - 24
Hi PrettyWoman, The job market is the market in which employers search for
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Anton Luyten 2019 - 09 - 11
Hello Fluffy, A harami cross is a Japanese candlestick pattern that consists
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Chaoxiang Lee 2019 - 09 - 07
Hi Maria, A caplet is a kind of call option based on interest rates. The
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Apinya Kamon 2019 - 09 - 04
Hello ForexGuy, A false market occurs when prices are manipulated and impacted
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Tom Burke 2019 - 08 - 31
Hello LuckyWoman, The yearly probability of living is determined by consulting
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