The spread charts have lots of advantages, compared to the usual trading products.  Its use is completely unknown in the world, though lately its been trying to introduce what is called “relative value pairs” trading, but this way of operating is as far from the professional use of spread charts as the difference in the quality of a musical beat played with a hollow trunk and the most sublime Mozart symphony.

 The new generation of spread charts provides a more professional approach to the technical analysis adding immense potential in some situations, moments and products, where operating with simple charts can not guarantee the adequate success rate to take the risk entering the market.

Another advantage of these charts is to compose an artificial graphic representation where certain movements can not occur due to its nature, or where its structure guarantees a movement within a narrow price range (ideal for selling volatility). If due to the composition of the chart we can estimate the absolute top, bottom or both, drawing a very reliable strategy to exploit its fluctuations will be child’s play, because the most difficult questions to answer in a simple chart in this case are already known before designing the strategy.

  The spread charts represent the combined rate of several contracts that are not quoted directly in the market.  Despite this, anyone can operate in the market at the price of that artificial chart buying or selling the same formula that has been used for the construction of the chart.  Although such operations have a higher cost in commissions, the advantages that provide in many cases completely overshadow this small inconvenience.

 So far the power of a computer for technical analysts had allowed the calculation of sophisticated moving averages and oscillators, but because of the massive public use, the few advantages they might offer were quickly cancelled (assuming they could ever have one).

 A technical analyst who intends to live on trading can not afford to use indicators, oscillators, moving averages and tools available to the public and for which there is no need of intelligence and experience to make decisions.

 This is obvious due to the following reasons: 

•  The large-scale use of any method, even a good one, immediately sets up contraindications.
•  There are no moving averages or oscillators that work well in both ranging and trending markets.
•  When a trading method or system becomes very popular, the real market professionals start going against it because they know that to earn money you need to act as the contrarian opinion of the market.

 Due to this, the spread charts gives the following advantages:

 1 – Do not move with the market trend.

 2 – They are perfect for a truly diversified portfolio, because the standard stocks all tend to move in unison, even if they belong to different sectors or countries.

 3 – The vast majority of spread combinations produce a very low volatility and therefore a very moderate risk.

 4 – Due to the condition that they do not move with the trend, the risks of trading multiple spreads at the same time is neutralized because each one cancels the other, which lowers the risk of the portfolio.

 5 – When using the combination of a bought future of an index, stock group or underlying opposite to other group of sold shares, future of an index or underlying the resulting cost of the rollover becomes zero.

 6 – As the formula that produces each spread is unique and is closely related to the specific strategy of each person, the spread will never have a massive use that would produce unfavourable effects on the trades, since the results of a method or tool are directly proportional to its performance, but it is inversely proportional to the number of people who use it.

 7 – When trading the spread of two futures of the same underlying but different expiration dates having the interest or rollover in favour, we have another advantage only for taking that trade.

 8 – In the case of trading the spread of options, typically the cost of the premium is lower and the strong changes in premium due to changes in volatility are cancelled.

 The different families of spreads could be classified into the following groups:

 a) Spreads involving futures contracts.

 b) Spreads of options contracts.

 c) An index against another.

 d) Groups of shares against an index.

 e) An underlying against another in the same sector.

 f) Spread between a stock and another in a different sector.

 We are now developing an effective and powerful tool to create a wide variety of spreads and manage the charts easily and with multiple combinations. Although there is a huge number of indicators and mathematical systems that you can find, we are going to implement the really ones that work and soon will be available to all the visitors of the web.

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