Credit Spread (options)
In finance, a credit spread, or net credit spread, involves a purchase of one option and a sale of another option in the same class and expiration but different strike prices. Investors receive a net credit for entering the position, and want the spreads to narrow or expire for profit. In contrast, an investor would have to pay to enter a debit spread.
Read more about Credit Spread (options): Credit Spread Options, Breakeven, Maximum Potential, Analysis
Famous quotes containing the words credit and/or spread:
“Gratitude among friends is like credit among tradesmen: it keeps business up, and maintains commerce. And we pay not because it is just to discharge our debts, but that we might the more easily find lenders on another occasion.”
—François, Duc De La Rochefoucauld (1613–1680)
“A little quaker, the whole body of him trembling,
His absurd whiskers sticking out like a cartoon-mouse,
His feet like small leaves,
Little lizard-feet,
Whitish and spread wide when he tried to struggle away,”
—Theodore Roethke (1908–1963)