Greeks

Lambda (Leverage Ratio)

By Ryan Silk & Lawrence Polatchek · Reviewed April 2026 · Options Trading Glossary

Option leverage as percentage sensitivity

What is Lambda (Leverage Ratio)?

Lambda (Leverage Ratio) The percentage change in option price for a 1% change in the underlying price, representing the effective leverage of the option. Also called the leverage ratio or elasticity. Lambda shows how many times more the option price moves in percentage terms compared to the stock.

Complete Definition

The percentage change in option price for a 1% change in the underlying price, representing the effective leverage of the option. Also called the leverage ratio or elasticity. Lambda shows how many times more the option price moves in percentage terms compared to the stock.

Example

An option with lambda of 10 will move 10% for every 1% move in the stock, providing 10x leverage.

Related Terms

Delta Gamma Intrinsic Value

Written by

ApexVol Research Team

Quantitative options research

All calculations use live ORATS institutional data — the same source used by professional volatility desks.

Technical reviewer

Ryan Silk, ApexVol Founder

Reviewed for technical accuracy

10+ years trading options. Built ApexVol's pricing engine, Greeks model, and IV-rank methodology.

This guide is updated as market conditions and ORATS data change. Last revised 2026-05-12. How we research →

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