Glossary of Stock Market Terms

Term of the Day:

Bear spread: Applies to derivative products. Strategy in the options or futures markets designed to take advantage of a fall in the price of a security or commodity. A bear spread with call options is created by buying a call option with a certain strike price and selling a call option on the same stock with a lower strike price (with the same expiration date). A bear spread with put options is where an investor buys a put with a high strike price and sells a put with a low strike price. With futures, the investor sells the nearby contract and purchases the next out contract. All of these strategies are designed to profit from a fall in the underlying asset's price.

 

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About the Glossary

Whether you're a new investor or a seasoned pro, it helps to have a solid glossary at your fingertips to provide quick clarification on a particular term or to expland your overall stock market vocabulary. The NASDAQ.com Glossary of financial and investing terms allows you search by term or browse by letter more than 8,000 terms and definitions related to the stock market. It's powered by the Hypertextual Finance Glossary by Campbell R. Harvey of Duke University.


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Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

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