Options & derivatives
Option Greeks
The Greeks are measures (delta, gamma, theta, vega...) that show how an option's price reacts to different factors.
The Greeks are measures (delta, gamma, theta, vega...) that show how an option's price reacts to different factors.
Delta measures sensitivity to the underlying's price, theta the effect of passing time, vega the effect of volatility. Understanding them helps you know why an option gains or loses value.
A delta of 0.5 means the option gains about $0.50 when the stock rises $1.
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