> ## Documentation Index
> Fetch the complete documentation index at: https://docs.fincept.in/llms.txt
> Use this file to discover all available pages before exploring further.

# Kirk Spread Option Price

> Price a spread option using Kirk's approximation. A spread option has payoff based on the difference between two asset prices: max(F1 - F2 - K, 0) for a call.

**Use Cases:**
- Price crack spread options (oil refining: crude oil vs. refined products)
- Value spark spread options (power generation: electricity vs. gas)
- Price calendar spread options (same asset, different maturities)
- Value commodity processing spreads
- Inter-exchange arbitrage options

**Model:** Kirk's approximation is accurate when F2 >> K (typical for most practical cases).

**Tier:** Standard (2 credits/request) [Tier: PRO, Credits: 5]



## OpenAPI

````yaml api-specs/pricing.json post /quantlib/pricing/kirk/spread-price
openapi: 3.1.0
info:
  title: FinceptQuantLib API - Pricing Module
  description: >-
    Advanced options pricing models including Black-Scholes, Black76, Bachelier,
    Kirk spread options, and binomial trees. Standard Tier access required (2
    credits per request).
  version: 3.0.0
  contact:
    name: Fincept API Support
    url: https://fincept.in
servers:
  - url: https://api.fincept.in
    description: Fincept API Production Server
security:
  - APIKeyHeader: []
tags:
  - name: quantlib-pricing
    description: Advanced options pricing models and Greeks calculation
    x-displayName: Pricing
paths:
  /quantlib/pricing/kirk/spread-price:
    post:
      tags:
        - quantlib-pricing
      summary: Kirk Spread Option Price
      description: >-
        Price a spread option using Kirk's approximation. A spread option has
        payoff based on the difference between two asset prices: max(F1 - F2 -
        K, 0) for a call.


        **Use Cases:**

        - Price crack spread options (oil refining: crude oil vs. refined
        products)

        - Value spark spread options (power generation: electricity vs. gas)

        - Price calendar spread options (same asset, different maturities)

        - Value commodity processing spreads

        - Inter-exchange arbitrage options


        **Model:** Kirk's approximation is accurate when F2 >> K (typical for
        most practical cases).


        **Tier:** Standard (2 credits/request) [Tier: PRO, Credits: 5]
      operationId: kirk_spread_price
      requestBody:
        required: true
        content:
          application/json:
            schema:
              $ref: '#/components/schemas/KirkSpreadRequest'
            example:
              F1: 105
              F2: 100
              strike: 3
              risk_free_rate: 0.05
              sigma1: 0.3
              sigma2: 0.25
              rho: 0.6
              time_to_maturity: 1
              option_type: call
      responses:
        '200':
          description: Successful calculation
          content:
            application/json:
              schema:
                type: object
                properties:
                  success:
                    type: boolean
                    example: true
                  data:
                    type: object
                    properties:
                      spread_price:
                        type: number
                        description: Spread option price
                        example: 5.234
                      option_type:
                        type: string
                        example: call
        '401':
          $ref: '#/components/responses/UnauthorizedError'
        '402':
          $ref: '#/components/responses/InsufficientCreditsError'
        '422':
          $ref: '#/components/responses/ValidationError'
components:
  schemas:
    KirkSpreadRequest:
      type: object
      required:
        - F1
        - F2
        - strike
        - risk_free_rate
        - sigma1
        - sigma2
        - rho
        - time_to_maturity
      properties:
        F1:
          type: number
          description: Forward price of first asset
          example: 105
        F2:
          type: number
          description: Forward price of second asset
          example: 100
        strike:
          type: number
          description: Strike price of the spread option
          example: 3
        risk_free_rate:
          type: number
          description: Risk-free interest rate (annualized, decimal format)
          example: 0.05
        sigma1:
          type: number
          description: Annualized volatility of first asset (decimal format)
          example: 0.3
        sigma2:
          type: number
          description: Annualized volatility of second asset (decimal format)
          example: 0.25
        rho:
          type: number
          description: Correlation between the two assets
          example: 0.6
        time_to_maturity:
          type: number
          description: Time to expiration in years
          example: 1
        option_type:
          type: string
          enum:
            - call
            - put
          description: Type of spread option
          example: call
          default: call
  responses:
    UnauthorizedError:
      description: Authentication information is missing or invalid
      content:
        application/json:
          schema:
            type: object
            properties:
              detail:
                type: string
                example: Invalid API key
    InsufficientCreditsError:
      description: Insufficient API credits for this request
      content:
        application/json:
          schema:
            type: object
            properties:
              detail:
                type: string
                example: >-
                  Insufficient credits. This endpoint costs 2 credits per
                  request.
    ValidationError:
      description: Request validation failed
      content:
        application/json:
          schema:
            type: object
            properties:
              detail:
                type: array
                items:
                  type: object
                  properties:
                    loc:
                      type: array
                      items:
                        type: string
                    msg:
                      type: string
                    type:
                      type: string
  securitySchemes:
    APIKeyHeader:
      type: apiKey
      in: header
      name: X-API-Key
      description: >-
        API key for authentication. Get your key at
        https://api.fincept.in/auth/register

````