Types of Spread In Options Trading

There are two main types of spread in options trading. Vertical spread is one type and is more popular than the horizontal spread. Vertical spreads involve buying a call at a given premium, but selling another call at a higher premium.

The definition of horizontal strike according to Investopedia.com is: "An options trading strategy involving the simultaneous purchase and sale of two options of the same type, having the same strike price, but different expiration dates." This strategy is practiced a lot less frequently because it is more complex than the vertical spread option strategy.


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