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Vertical Spread
Vertical Spread
Vertical Spread
Vertical Spread
Vertical Spread

The following information is about Vertical Spread.

Vertical Spread Defined

Strategy where an investor concurrently buys and sells options on the same underlying security--also called a price spread. Both options have identical expiration dates but different strike prices. For instance, a vertical spread is created by buying an XYZ April 20 call and selling an XYZ April 25 call. This strategy is used in hopes of profiting as the difference between the option premium on the two option positions widens or narrows.

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Tue Jan 29

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