What is the concept of spread in options and futures trading?

Economics Options And Futures Questions



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What is the concept of spread in options and futures trading?

The concept of spread in options and futures trading refers to the difference between the buying price (ask) and selling price (bid) of a particular option or future contract. It represents the cost or profit potential associated with entering or exiting a trade. The spread can be influenced by various factors such as market conditions, liquidity, and the specific option or future being traded.