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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.

 
 

Follow this link for all the terms related to spread.

 
 Embedded terms in definition
 Calendar
Duration
Flat
Horizontal spread
Interest rate
Interest
Market
Option
Position
Profit
Spread
Time value
Time
Volatility
 
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