Stocks & Commodities V. 27:3 (67): Futures For You by Carley Garner

Stocks & Commodities V. 27:3 (67): Futures For You by Carley Garner
Item# \V27\C03\054GARN.PDF
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Futures For You by Carley Garner

ON SPREADS

What is a futures spread?

The terminology involved in futures spread trading often seems like a foreign language. This can cause those who arenít familiar with the practice to misinterpret the vocabulary. Despite the complexity of the topic on the surface, once you understand a few key concepts, you will gain an immediate understanding.

A futures spread is a trade in which opposite positions are taken in similar futures contracts. Simply put, it is the purchase of one commodity and the sale of another related commodity with the intention of profiting from changes in the spread, or differences in the relation of the two prices.




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