In finance, a debit spread, AKA net debit spread, results when an investor simultaneously buys an option with a higher premium and sells an option with a lower premium. The investor is said to be a net buyer and expects the premiums of the two options (the options spread) to widen. ==Bullish & Bearish Debit Spreads== Investors want debit spreads t...
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Applies to derivative products. Difference in the value of two options, when the value of the option bought exceeds the value of the one sold. One buys a 'debit spread.' Antithesis of a credit spread.
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The amount that is owed to a broker by a margin customer for loans the customer uses to buy securiti
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http://www.encyclo.co.uk/local/22402
An option position in which the price of the option bought is greater than the price of the option... <a target=_blank href='http://www.finance-glossary.com/terms/debit-spread.htm?id=2238&ginPtrCode=00000&PopupMode=false' title='Read full definition of debit spread'>more</a>
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Is an option position whereby the end result is a debit. For example, the investor who places a vertical bull call spread pays a net premium or is debited. Similarly, a risk manager who places a vertical bear put spread is charged a net premium or is debited.
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A debit spread is an options strategy that seeks to attain maximum profit by capitalizing on the difference between the premium paid for the long component of the spread minus the premium paid for the short component of the spread.
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