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For decades, institutional traders have limited the risk exposure of their portfolios by implementing delta hedging strategies. These methodologies are now gaining popularity among retail traders in the stock, currency, and futures markets.
Many traders have heard about an option’s delta, but they have no idea what it means or how they can implement it in their own trading strategy.
Option traders are often speaking another language. I want to help you understand how your option’s value is going to be affected by changes in the market. We can calculate how our option is going to react to these changes by understanding the Option Greeks. The Black-Scholes Model identifies 5 Option Greeks to help us… Read more.