[New Feature Upgrade]Calendar Spread & Diagonal Spread Option Strategies Are Now Available

Calendar Spread and Diagonal Spread option strategies are now available on moomoo!  

Update to the latest version to experience it!

A calendar spread is a strategy usually used in options trading: two positions are opened at the same time – one long, and the other short. Calendar spreads are also known as ‘time spreads’, ‘counter spreads’ and ‘horizontal spreads’. In the options strategy version, calendar spreads are set up within the same underlying asset and strike price, but different expiration dates.

A diagonal spread is a modified calendar spread involving different strike prices. It is an option strategy established by simultaneously entering into a long and short position in two options of the same type—two call options or two put options—but with different strike prices and different expiration dates.

A calendar spread’s long and short strikes share the same strike price, which makes it a cheaper trade on entry compared to a diagonal spread.

A diagonal spread’s long and short strikes are on different strikes, and typically mimic a setup of a traditional vertical debit spread. Calendar spreads are much more about theta decay, whereas a diagonal spread has a directional nature to it.

Let's take a look at the following example to see the difference between the Calendar Spread and Diagonal Spread.

The calendar spread is a relatively low-risk, directionally neutral strategy that profits from the passage of time and/or an increase in implied volatility.

If you anticipate the future market to fluctuate in a certain range with limited volatility, the calendar spread strategy would be a good choice.

Step 1: Select options from the individual stock detail quote, and go to the "options chain" page, tap [Single Option] to choose Calendar Spread.

Step 2: Choose [Expiration Width] and strike price to build your calendar spread strategy, you can tap the icon underneath on the right to view the P&L analysis of the option strategy.

Step 3: Fill in your order information and trade in one click.

Feel free to share your experience of using option strategies. We are delighted to hear your feedback to further improve our product and we look forward to hearing more about your trading stories.