Tuesday, November 25, 2008

Stock Option Terms: Leg in / Leg out

Leg in / Leg out:
Legging into a spread involves the completion of just one component part at a time with the intention of filling the other legs of the option trade at more favorable prices later.

Legging out of a spread involves the opposite scenario. In this case the option trader exits one leg of a multi-legged option trade, one component at a time.

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