A ladder refers to a strategy where an investor spreads out their investments across different maturities or time frames. It involves purchasing a series of securities with staggered maturity dates. This strategy is commonly used in bond investing, but it can also be applied to other types of investments such as certificates of deposit (CDs) or annuities.

The idea behind a ladder strategy is to balance the benefits of both short-term and long-term investments. By spreading out investments over different maturities, investors can potentially benefit from higher interest rates associated with longer-term investments while maintaining liquidity through the periodic maturity of shorter-term investments. This approach helps to reduce the impact of interest rate fluctuations and provides a steady stream of income or reinvestment opportunities.

A ladder strategy offers flexibility and can be customized to meet individual investment goals and risk tolerances. It allows investors to have a diversified portfolio with a mix of short and long-term investments, providing a balance between stability and potential returns.

In trading, a ladder refers to a strategy where a trader places multiple orders at different price levels to manage risk and maximize profit. This method is commonly used in options and futures trading. By "laddering" their trades, investors can gradually enter or exit positions, allowing them to capitalize on market movements and avoid committing all their capital at a single price point. This approach helps in averaging out the entry and exit prices, reducing the impact of market volatility. Laddering can also refer to a bond investment strategy where bonds with different maturities are purchased, spreading risk over time. In both contexts, the ladder technique offers a structured and diversified way to manage investments and enhance returns.