ATM

Gamma confuses some options traders because it's a “secondary” indicator. It measures the speed of change in another indicator: delta. Delta measures the rate of premium change in the options related to changes in the underlying (and of course is affected by time and proximity). Gamma measures how...

Is the backspread always a bear strategy? Most traders think of the put ratio backspread in this way. Why? Because it involves puts. But in fact, it is not a bear strategy, but a volatility strategy. That means its’ designed to turn profitable due to fast point movement in the underlying. The...