Gamma (Options Greek)
Measures how fast Delta changes as the underlying price moves - the acceleration of an option's price.
Formula
More Details
What is Gamma?
Gamma measures how fast your Delta changes. High Gamma means your directional exposure can shift rapidly as prices move.
Learn more: Options Greeks Guide | Greeks Analysis | Options Intraday Charts
Gamma Characteristics
- Highest at ATM: At-the-money options have the highest Gamma
- Peaks Near Expiration: Gamma increases dramatically as expiration approaches
- Long Options = Positive Gamma: Your delta improves as the stock moves in your favor
- Short Options = Negative Gamma: Your delta worsens as the stock moves against you
Why Gamma Matters
High Gamma near expiration is dangerous for short options:
* A small price move can dramatically shift your delta
* Short Gamma positions can "blow up" on large moves
* This is why many traders close positions before expiration week
Gamma Risk
| Position | Gamma | Risk |
|---|---|---|
| Long ATM options near expiry | High positive | Expensive but explosive potential |
| Short ATM options near expiry | High negative | Small moves cause large losses |
| Deep ITM/OTM | Low | Stable delta, less dynamic |
TradesViz Portfolio Gamma
The Options Command Center displays Net Gamma across all positions. High portfolio Gamma means your overall exposure can change quickly.
Where to find it in TradesViz
Example
ATM option with 0.05 Gamma means Delta increases by 0.05 for every 1 dollar move.