What is the impact of gamma on call options in the cryptocurrency market?

1 answers

• KaskarSamaelOct 11, 2020 · 5 years ago
  When it comes to call options in the cryptocurrency market, gamma is a key factor to consider. Gamma measures the rate at which the delta of an option changes in response to changes in the underlying asset's price. In the context of call options, gamma determines how quickly the option's delta will increase as the price of the underlying cryptocurrency rises. This means that call options with higher gamma values will experience larger price movements in response to changes in the cryptocurrency's price. Traders who are looking to profit from short-term price movements in the cryptocurrency market may find call options with higher gamma values more attractive, as they offer the potential for greater returns. However, it's important to note that gamma also increases the risk associated with call options, as they can lose value rapidly if the price of the underlying cryptocurrency moves against the trader's expectations.
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