In the case of fixed exchange rates, as in ERM II, the area left to free market operations before market intervention. The wider this spread range, the closer the system approaches floating exchange rates. – An investor establishes more long positions than short positions in the futures market with respect to a particular asset as the underlying asset (spread composed of more long options than short options on the same underlying asset; this position usually profits from a large movement in either direction in the underlying asset). – See spread, butterfly spread, future, close-out, calendar spread, long hedge, option, long position, short position.
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