Neutral spread

• Is a term used to describe various positions. It can refer to a position that attempts to capitalize on flat or stable market price conditions, to be relatively immune to market swings, or to benefit from volatility. In these cases, the spread tries to minimize the impact of adverse price, duration, or volatility movements.

• Is an option strategy which is nondirectional in terms of price or interest rate movement. It seeks to profit by collecting time value. One such strategy is the Calendar or Horizontal Spread.


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 Embedded terms in definition
Horizontal spread
Interest rate
Time value
 Related Terms

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