Futures & options
What is Option Greeks?
Also called: Delta, Theta, Gamma, Vega
Hinglish mein padhein: Option Greeks kya hote hain?
The Greeks measure how an option's price responds to changes: delta (underlying price), theta (time), vega (volatility) and gamma (change in delta).
A delta of 0.5 means the option gains about ₹0.50 for every ₹1 rise in the underlying. Theta shows how much value is lost each day.
Understanding the Greeks is essential before selling options.
Related terms
- Option premiumThe premium is the price of an option. It is made of intrinsic value (how much it is in the money) plus time value.
- Implied volatility (IV)Implied volatility is the market's expectation of future volatility, backed out from option prices. High IV means expensive options.
- Options (call and put)An option gives the buyer the right, but not the obligation, to buy (call) or sell (put) at a strike price before expiry. The seller takes the obligation.