The Rho of an Option Is

question 352

Multiple Choice

The rho of an option is:

• A) The sensitivity of the option value to changes in interest rates
• B) The sensitivity of the option value to changes in volatility
• C) The sensitivity of the option value to changes in the time to expiry
• D) The sensitivity of the option value to changes in the price of the underlying

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Definitions:

Magnesium

A shiny gray solid, this chemical element has symbol Mg and atomic number 12, known for its lightness and strong structural properties, widely used in alloys.

Chloride

A compound formed with chlorine and another element or group, commonly found in table salt (sodium chloride).

Magnesium Sulfate

A chemical compound, a salt with the formula MgSO4, often encountered as the heptahydrate sulfate mineral epsomite (commonly known as Epsom salt).

Sulfur

A nonmetallic chemical element with the symbol S and atomic number 16, known for its yellow crystalline appearance and importance in organic molecules.