Options Greeks Cheat Sheet: Quick Reference Guide
Your quick-reference guide to all five options Greeks. Understand delta, gamma, theta, vega, and rho with clear examples and practical trading rules.
What is Options Greeks?
Options Greeks are mathematical measures of sensitivity that describe how an option's price changes in response to various factors: stock price (delta/gamma), time (theta), volatility (vega), and interest rates (rho).
Greeks are essential for risk management. Professional traders monitor Greeks continuously to understand their exposure and make informed adjustments.
TL;DR - Quick Answer
The Greeks Cheat Sheet: Delta = directional exposure (0.50 = $0.50 per $1 stock move). Gamma = delta's rate of change (accelerates gains/losses). Theta = daily time decay (costs you $ each day). Vega = IV sensitivity ($change per 1% IV move). Rho = interest rate sensitivity (usually minor). Calls: +delta, +gamma, -theta, +vega. Puts: -delta, +gamma, -theta, +vega.
Delta: Your Directional Exposure
What it measures: How much the option price changes for a $1 move in the stock.
Range: Calls: 0 to +1.0 | Puts: -1.0 to 0
Quick rule: A 0.50 delta call gains $0.50 when the stock rises $1. A -0.30 delta put gains $0.30 when the stock drops $1. Delta also approximates the probability the option expires ITM—a 0.30 delta option has roughly a 30% chance of being ITM at expiration.
Gamma: Delta's Accelerator
What it measures: How fast delta changes for a $1 move in the stock.
Quick rule: High gamma = delta changes fast = bigger gains AND bigger losses. ATM options near expiration have the highest gamma. Gamma is highest for 0DTE options and lowest for LEAPS. If gamma is 0.05, a $1 stock move changes your delta by 0.05.
Theta: The Time Decay Clock
What it measures: How much value the option loses each day from time passing.
Quick rule: Theta is always negative for option buyers (you lose value daily) and positive for sellers (you gain). A theta of -0.05 means the option loses $5 per day (per contract). Theta accelerates in the last 30 days and is most severe in the final week before expiration.
Vega: Volatility Sensitivity
What it measures: How much the option price changes for a 1% change in implied volatility.
Quick rule: A vega of 0.10 means the option gains $10 per contract if IV rises 1%. Longer-dated options have higher vega. Vega matters most around earnings and events. Option buyers want IV to rise (long vega), sellers want it to fall (short vega).
Rho: Interest Rate Sensitivity
What it measures: How much the option price changes for a 1% change in interest rates.
Quick rule: Rho matters least for short-dated options. It becomes relevant for LEAPS and during Fed rate decisions. Higher rates increase call values and decrease put values, but the effect is usually small compared to the other Greeks.
Key Takeaways
- Delta = directional exposure ($0.50 delta means $50 gain per $1 stock move per contract)
- Gamma = how fast delta changes (highest ATM, near expiration)
- Theta = daily time decay cost (accelerates in final 30 days)
- Vega = IV sensitivity (critical around earnings and events)
- Rho = interest rate sensitivity (usually minor, matters for LEAPS)
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Understanding related strategies helps you choose the best approach for your market outlook and risk tolerance. Each strategy has unique characteristics that make it suitable for different market conditions.
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