A reverse calendar spread is used to take advantage of unexpected high volatility.

Question

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A reverse calendar spread involves buying an option with a later expiration date and selling an option with an earlier expiration date, but with the same strike price. This strategy is used to profit from an increase in volatility, as it allows the trader to benefit from higher premium values on the shorter-term option while holding a cheaper long-term option to take advantage of any potential price movement.

A Reverse Calendar Spread Is Used to Take Advantage of Unexpected