Learn About Options Greeks: What is Theta?



Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options at http://www.tradeking.com/ODD . VIDEO SUMMARY: In TradeKing's latest video series on options "Greeks", Brian Overby tackles theta, the Greek that measures the theoretical impact of time decay on an option's price. TO EMBED THIS VIDEO IN YOUR SITE: Go to http://bit.ly/p1274o and click on the "up" arrow in the bottom right corner of the video player. This will reveal a permanent link and embed code for your use. 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 Theta represents the consensus of the marketplace as to the amount a theoretical option's price will change for a corresponding one-unit (day) change in the days to expiration of the option contract there is no guarantee that this forecast will be correct. Online trading has inherent risks due to system response and access times that vary due to market conditions, system performance and other factors. An investor should understand these and additional risks before trading.

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    Additional Information:

    Visibility: 13007

    Duration: 6m 33s

    Rating: 52