Negative Gamma: How much is too much?

A recent question brings up something very important in the everyday life of an options trader. It’s the type of discussion that is almost always overlooked by options educators. Most traders figure out the answers for themselves – but they only do that as time passes and experience is gained.

Today, let’s take a more detailed look at these questions:

Question: Last (live) session. I mentioned I was paper trading weekly’s. You said you did not like them because there was too much negative gamma. How much is too much negative gamma, in your opinion?

While you are on the subject, how much is too much positive delta?

By the way… the greeks and adjustments. That is why I am here with you – to learn that part.

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2 Responses to “Negative Gamma: How much is too much?”


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