FAQ: Why Theta Isn't Linear (300 Days vs. 3 Days)
Learn why Theta accelerates as expiration approaches. OIC instructor Mat Cashman compares a 300-day and a 3-day option to show how decay scales with the percentage of time remaining.
0:00 Introduction: Exponential Nature of Theta
0:19 Example: 300 Days vs. 3 Days
0:42 Removing 33% vs. 0.3% of Time
1:12 Price Iterations Remaining
1:35 Theta as Percentage of Value
2:04 Using Theta in Strategies
2:37 Fast Forward 10 Days Scenario
Register to view the complete 0DTE Options – The Move to Shorter Duration Options and What It Means for Risk webinar: https://bit.ly/4wWNFAw
Recommended Videos
Theta and Time Decay Explained
Time decay affects your trades and your account every day. This clip breaks down the math of holding a position as it gets closer to expiration.
Watch Now
Gamma: The Accelerator Behind Your Delta
Gamma measures the rate of change in delta for every $1 move in the underlying. Discover why gamma is highest for at-the-money options, how it accelerates delta as a stock moves in your favor, and why high gamma can work against you just as quickly if the stock reverses.
Watch Now
Delta Explained: Reading Your Options Speedometer
Delta measures how much an option's price changes for every $1 move in the underlying stock. See how it scales from near zero for deep out-of-the-money options to 1.00 for deep in-the-money options, and why at-the-money options consistently carry a delta.
Watch Now