The greeks
Delta, gamma, theta, vega, rho — the sensitivities that explain how an option's price moves.
The greeks measure how an option's price reacts to the things that move it: the stock, time, and volatility. Delta tracks price, gamma tracks how delta changes, theta tracks time decay and vega tracks volatility. You do not need the math, but you need the intuition for each one.
Delta (Δ) — directional exposure
How much the option price moves per $1 move in the stock. A 0.50 delta call gains about $0.50/share when the stock rises $1. Delta also reads as the rough probability of expiring in the money — 0.50Δ ≈ a coin flip.
Gamma (Γ) — how fast delta changes
The rate of change of delta per $1 move. Gamma is highest for at-the-money options near expiry — which is exactly why 0–2 day ATM options move so violently. High gamma is a double-edged sword: fast gains, faster losses.
Theta (Θ) — time decay
The value the option loses per day just from time passing. A −0.05 theta contract bleeds $5/day. Decay accelerates in the final week — holding a losing long option into expiry is how premium evaporates.
Vega (V) — volatility exposure
How much the option price changes per 1% change in implied volatility. Long options are long vega: they gain when volatility rises and lose when it falls — even if the stock goes your way. This is the source of IV crush (next page).
Rho (ρ) — interest rates
Sensitivity to interest rates. The smallest greek for short-dated trades — safe to ignore for most of what you will do.