Interdelivery Spread

DEFINITION of 'Interdelivery Spread'

Simultaneously entering a long and short on the same futures contract but with different delivery months in the hopes that the price difference between the two months widens or narrows, depending on the underlying investment.

BREAKING DOWN 'Interdelivery Spread'

Spread traders are only concerned that their long positions rise in value relative to their short positions. For example, if a trader is long June corn and short August corn, then the trader is hoping that the price of June corn rises and the price of August corn falls.

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    Learn how different types of derivatives are priced, including how futures contracts are valued and the Black-Scholes option ... Read Answer >>
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