1/ ๐ DeFi Pulse Drop #19: @sirenprotocol ๐
Options traders have come to rely on tools in traditional finance that were refined over decades.
And with options being fairly new to DeFi, SIREN aims to fill a niche by building a platform suited for sophisticated options traders.
Options traders have come to rely on tools in traditional finance that were refined over decades.
And with options being fairly new to DeFi, SIREN aims to fill a niche by building a platform suited for sophisticated options traders.
2/ To make full use of SIRENโs design which allows traders to easily swap options in and out in order to build complex positions, options traders need the necessary information to properly assess those positions.
This is why SIREN's UI displays the greeks for each option.
This is why SIREN's UI displays the greeks for each option.
3/ Option "Greeks," named after the Greek letters that denote them, measure risks associated with a position.
If you're new to options, you may find this helpful for becoming familiar with greeks. investopedia.com/trading/gettinโฆ
If you're new to options, you may find this helpful for becoming familiar with greeks. investopedia.com/trading/gettinโฆ
4/ The greeks are calculated from the price of the underlying asset, strike price of the option, estimate of volatility of the underlying asset, time to expiration, current interest rate and any dividends payable on the underlying asset before the option's expiration date.
5/ Full explanations are a bit long for Twitter so we'll give you the TLDR on greeks:
Delta - measures the ratio comparing the difference between the underlying asset price relative to the price of the option
Gamma - if delta is an options speed, gamma is acceleration
Delta - measures the ratio comparing the difference between the underlying asset price relative to the price of the option
Gamma - if delta is an options speed, gamma is acceleration
6/ Theta - measures the rate of decline in the value of an option due to the passage of time sometimes referred to as time decay. Theta is indirectly proportional to gamma.
Vega - measures how much the value of an option changes when the implied volatility of that option changes
Vega - measures how much the value of an option changes when the implied volatility of that option changes
7/ The more time there is until expiration, the higher the vega is for an option.
For more detailed explanations of how options traders and the SIREN protocol itself utilize these greeks, be sure to read the latest drop defipulse.com/blog/siren/
For more detailed explanations of how options traders and the SIREN protocol itself utilize these greeks, be sure to read the latest drop defipulse.com/blog/siren/
8/ This is paid promotion as part of our DeFi Pulse Drops series where DeFi Pulse works with projects to launch their new features and builds. If you want us to work with you, please get in touch!
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