Skillsfirst Level 5 Diploma in Financial Trading (RQF) - Module 1 - Trading Introduction
Skillsfirst Level 5 Diploma in Financial Trading (RQF) - Module 2 - Financial Products
Skillsfirst Level 5 Diploma in Financial Trading (RQF) - Module 3 - Economic Principles
1 of 2

SPREADS: AN EXAMPLE

Imagine the price trend of soybeans is currently up and you are in a soybean spread, (short one month and long another).

The gain on the long position would likely offset the loss of the short position, and vice-versa.

One side of the spread typically hedges the other, therefore the lower margin requirements.

Remember: Spreads are not guaranteed to be less risky, there is risk of loss in all trading.

Scroll to Top