What does the term “delta” mean?
A measure of the rate of change in an option’s theoretical value for a one-unit change in the price of the underlying stock.For example if the delta of a call option is 50 (or .50 to be more precise), for each one point move in the stock, the anticipated movement of the option would be a half point – or 50%.(The delta would be described in negative percentages for puts as the movement is opposite.
A measure of the rate of change in an option’s theoretical value for a one-unit change in the price of the underlying stock. For example if the delta of a call option is 50 (or .50 to be more precise), for each one point move in the stock, the anticipated movement of the option would be a half point – or 50%. (The delta would be described in negative percentages for puts as the movement is opposite.
