Learn About Options Greeks: What is Gamma?

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VIDEO SUMMARY:

TradeKing Sr. Options Analyst Brian Overby explains the “Greeks” most popular among options traders. This video reviews gamma, the “acceleration” Greek measuring how changes in another Greek, delta, are likely to impact an option’s price.

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PLEASE READ THESE DISCLAIMERS:

The Greeks represent the consensus of the marketplace as to how the option will react to changes in certain variables associated with the pricing of an option contract. While Delta represents the consensus of the marketplace as to the theoretical price movement of the option relative to the underlying security there is no guarantee that either of these forecasts will be correct.

While Gamma represents the consensus of the marketplace as to the theoretical rate of change of Delta relative to the underlying security there is no guarantee that this forecast will be correct.

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