Intercommodity Spread


DEFINITION of 'Intercommodity Spread'

Going long on one futures market in a given delivery month and simultaneously going short on the same commodity and delivery month but a different futures market but with similar underlying asset.

BREAKING DOWN 'Intercommodity Spread'

Examples of intercommodity spreads include the crack spread (crude oil vs. unleaded gasoline) and the crush spread (soybean oil vs. soybean meal).

  1. Intermarket Spread

    The simultaneous purchase of a given delivery month of a futures ...
  2. Delivery Month

    A key characteristic of a futures contract that designates when ...
  3. Intramarket Sector Spread

    The yield spread between two fixed-income securities with the ...
  4. Futures

    A financial contract obligating the buyer to purchase an asset ...
  5. Crack Spread

    The spread created in commodity markets by purchasing oil futures ...
  6. Crush Spread

    A trading strategy used in the soybean futures market. A soybean ...
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  3. Can mutual funds invest in options and futures?

    Mutual funds invest in not only stocks and fixed-income securities but also options and futures. There exists a separate ... Read Full Answer >>
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