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option adjusted spread

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Financial Dictionary

Option Adjusted Spread - OAS

Mainly used for fixed income products, OAS measures the yield spread that is not directly attributable to the fixed income's characteristics.

Investopedia Commentary

This is a measurement tool for evaluating price differences between similar products with different embedded options. A larger OAS implies a greater return for greater risks.

Related Links

Options Basics Tutorial

See also: Bond, Kicker, Sweetener

Also spelled: OAS

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