When One Puts on a Trade to Take Advantage of an Abnormal

Multiple Choice

When one puts on a trade to take advantage of an abnormal spread that one hopes will converge to the normal spread,which of the following is true?

A) Spread trades only work when the underlying prices of the two securities increase together.
B) A spread trade is always an arbitrage opportunity across time.
C) A spread trade works regardless of whether the underlying prices of the two securities increase or decrease.
D) A spread trade is always an arbitrage opportunity across space.
E) Spread trades always have a positive probability of losing money.