Bridge over ocean
1 July 1992 Financial Analysts Journal Volume 48, Issue 4

Pitfalls in the Analysis of Option-Adjusted Spreads

  1. David F. Babbel
  2. Stavros A. Zenios

The option-adjusted spread (OAS) has developed into a popular and powerful tool for portfolio management. The OAS allows the investor to adjust ex ante yields to a consistent basis for comparison. Valuable as it may be, however, this adjustment has some fundamental flaws.

Read the Complete Article in Financial Analysts Journal Financial Analysts Journal CFA Institute Member Content

We’re using cookies, but you can turn them off in Privacy Settings.  Otherwise, you are agreeing to our use of cookies.  Accepting cookies does not mean that we are collecting personal data. Learn more in our Privacy Policy.