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In Futures, a Calendar Spread involves buying or selling a contract in the near month (closest to expiration) and opening the opposite position another in the far month (longer to expiration than the near month).

An alternative term for Futures Calendar Spreads is Intra-Market Spreads because the same underlying asset or commodity is used but with two different timeframes.

One of the reasons why Futures Calendar Spreads are used is because the margin that a trader must put up to initiate a position is lower than a single long or short contract. Since the two positions offset each other, the risk is reduced and the capital requirement is also lower.
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Contributed by: Ralph Windsor

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Trading Oil with Calendar Spreads

TastyTrade video about Futures Calendar Spreads using oil as an example.


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Trading Calendar Spreads In Grain Markets
http://www.investopedia.com/articles/optioninvestor/calendar-spread-grain-market.asp

Investopedia article about calendar spreads in grain markets like corn, soybean and wheat.

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Trading Oil with Calendar Spreads

TastyTrade video about Futures Calendar Spreads using oil as an example.