'Delta' measures the rate of change of the option's price with respect to changes in the underlying asset's price. It is a key metric in options trading, reflecting the sensitivity of the option's price to movements in the underlying asset's price.
'Gamma' is a key Greek letter used in options trading to measure the rate of change of Delta with respect to changes in the underlying asset's price. It provides critical insights into the risk and price sensitivity of options.
Gamma (Γ) is a financial metric that measures the rate of change of delta with respect to the underlying asset's price. It is particularly significant in options trading to evaluate the sensitivity of delta.
Greeks are the sensitivity measures derived from the Black-Scholes formula, including Delta, Gamma, Theta, Vega, and Rho. They provide insights into how option prices are impacted by changes in market conditions.
Rho measures the sensitivity of the option value to changes in the interest rate, representing one of the Greek letters used in financial mathematics to assess risk.
Rho (ρ) measures how the price of an option changes in response to fluctuations in interest rates. It is a key component of the Greeks in options trading, providing insights into the interest rate risk of an option.
**Theta** measures the rate of change of the option's price concerning time, indicating how much the price of an option decreases as it approaches its expiration date.
Measures the sensitivity of an option's price to changes in the volatility of the underlying asset.
A comprehensive guide to understanding the Greeks in finance, their role in the options market, and how they are used to assess and manage risk.
