In derivatives trading, the term diagonal spread is applied to an options spread position that shares features of both a calendar spread and a vertical spread. It is established by simultaneously buying and selling equal amount of option contracts of the same type ( call options or put options) but with different strike prices and expiration dates.
Example
External links
- http://www.thestreet.com/story/10080609/1/real-world-trading-the-diagonal-spread.html
- Short Diagonal Call/Put Credit Spreads Archived 2020-01-21 at the Wayback Machine
In derivatives trading, the term diagonal spread is applied to an options spread position that shares features of both a calendar spread and a vertical spread. It is established by simultaneously buying and selling equal amount of option contracts of the same type ( call options or put options) but with different strike prices and expiration dates.
Example
External links
- http://www.thestreet.com/story/10080609/1/real-world-trading-the-diagonal-spread.html
- Short Diagonal Call/Put Credit Spreads Archived 2020-01-21 at the Wayback Machine
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