This is an order for the simultaneous purchase and sale of two (or more) options of the same type on the same underlying. If placed with a limit, the two options must be filled for a specified price difference, or better. It can be critical in this type of order to specify whether it is an opening transaction or a closing transaction.
Spread position Spread strategy
An order listing the series of options that the customer wants to buy and sell and the desired spread between the premiums paid and received for the options.
An order to execute the simultaneous purchase and sale of options of the same class for either a net debit or a net credit without regard to the prices of the individual options.
a combination of individual orders (legs) that work together to create a trading strategy
an order for the purchase and sale of two different contracts
An order to simultaneously buy one futures contract and sell a different futures contract at a quoted differential
An order to simultaneously transact two or more option trades. Typically, one option would be bought while another would simultaneously be sold. Spread orders may be limit orders, not held orders, or orders with discretion. They cannot be stop orders, however. The spread order may be either a debit or credit.
An order in which a spread transaction is described. See Spread.
An advanced option order that combines the purchase and sale of two puts or two calls on the same underlying security.
An order that indicates the purchase and sale of futures contracts simultaneously.