What is the delta of a futures contract?

0.5 1 -1 Varies based on the underlying asset

What does a delta of 0.7 for a call option indicate?

The option price will increase by 0.7 points for every 1 point increase in the underlying asset price. The option has a 70% chance of expiring in the money. The option price will decrease by 0.7 points for every 1 point increase in the underlying asset price. The option has a 30% chance of expiring out of the money.

How can you determine the overall delta of a portfolio containing multiple options contracts?

By averaging the deltas of all the individual options. By multiplying the deltas of all the individual options. By adding the deltas of all the individual options. By subtracting the deltas of put options from the deltas of call options.

What does a delta of -1 for a put option signify?

The option price will increase by 1 point for every 1 point decrease in the underlying asset price. The option has a 100% chance of expiring in the money. The option price will decrease by 1 point for every 1 point decrease in the underlying asset price. The option has a 0% chance of expiring out of the money.

What is a delta-neutral position?

A position where the total delta of all options contracts is zero. A position where the total delta of all options contracts is positive. A position where the total delta of all options contracts is negative. A position consisting only of futures contracts.

Can the delta of options on different underlying assets be added together?

Yes, deltas can be added for options on any underlying asset. No, deltas can only be added for options on the same underlying asset. Yes, but only if the options have the same expiration date. No, deltas cannot be added together.

How can delta be used to estimate the probability of an option expiring in the money?

By converting the delta value into a percentage. By multiplying the delta value by the option's strike price. By dividing the delta value by the option's premium. By subtracting the delta value from 1.

What is the delta of two ATM (At-The-Money) options?

0 0.5 1 2

Why should traders be cautious when shorting/writing ITM (In-The-Money) options?

Because ITM options have a high probability of expiring out of the money. Because ITM options have a high probability of expiring in the money. Because ITM options have a delta of 0. Because ITM options have a negative delta.