CherryBlossomFall
Mon Sep 30 2024
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7 answers
1429
What is delta in derivatives?
Could you please explain to me what the term 'delta' refers to in the context of derivatives trading? I understand it's a crucial concept in understanding the risk and potential profit of options and other derivative instruments, but I'm still unclear on the specifics. Is delta a measure of how sensitive the price of a derivative is to changes in the underlying asset? And how does this impact traders' decision-making processes? Thank you for your clarification.
amelia_harrison_architect
Thu Sep 12 2024
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7 answers
1722
How does theta decay?
Could you please elaborate on the concept of THETA decay and how it specifically applies to financial instruments, particularly in the realm of options trading? I'm curious to understand the mechanics behind this phenomenon and how it impacts the value of options over time. Additionally, are there any strategies that traders can employ to mitigate the effects of theta decay on their portfolios?
