Options Trading Options Greeks and Risk Management

Question 1

Which Greek measures the rate of change of an option's price relative to a $1 move in the underlying asset?

Accepted Answer

Delta

Answer

Gamma

Answer

Theta

Answer

Vega

Question 2

What does a negative theta value indicate for an options position?

Accepted Answer

The position loses value as time passes

Answer

The position gains value as time passes

Answer

The position is unaffected by time

Answer

The position has high volatility exposure

Question 3

Which Greek measures an option's sensitivity to changes in implied volatility?

Accepted Answer

Vega

Answer

Delta

Answer

Rho

Answer

Gamma

Question 4

What does Gamma measure in options trading?

Accepted Answer

The rate of change of Delta

Answer

The rate of change of Vega

Answer

The sensitivity to interest rates

Answer

The time decay per day

Question 5

Which Greek measures an option's sensitivity to interest rate changes?

Accepted Answer

Rho

Answer

Vega

Answer

Theta

Answer

Gamma

Question 6

A delta-neutral portfolio has a total delta of approximately:

Accepted Answer

Zero

Answer

One

Answer

Negative one

Answer

Fifty