How is RR bid offer quoted in market? For example: If a 25delta call and 25delta put is quoted as 5.5%/5.6% and 5.3%/5.5% respectively. What would be quote of a 25d RR with these call and Put?
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Market convention is for a bid-offer on a package. For example, if you ask a dealer for the market on a 25d RR on EURUSD, the BID would be for the dealer to BUY the EUR Call and SELL the EUR Put; and the OFFER would be where they SELL you the EUR Call and BUY the EUR Put.
Because you are buying a package, you would normally not have to cross the bid-ask on both legs. One leg would be fixed (usually at mid) and the bid-ask on the second leg would drive the bid-offer on the RR package.
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$\begingroup$ Then how is Butterfly B/O quoted pls? It has 4 call put combinations. $\endgroup$ – Ussu Oct 27 '19 at 3:24
