Which of the Following Is NOT True About Gamma

question 15

Multiple Choice

Which of the following is NOT true about gamma?

• A) A highly positive or highly negative value of gamma indicates that a portfolio needs frequent rebalancing to stay delta neutral
• B) The magnitude of gamma is a measure of the curvature of the portfolio value as a function of the underlying asset price
• C) A big positive value for gamma indicates that a big movement in the asset price in either direction will lead to a loss
• D) A long position in either a call or a put has a positive gamma

---

Definitions:

Market Segmentation

The practice of dividing a market into distinct groups of buyers with different needs, characteristics, or behaviors who might require separate products or marketing mixes.

Appraisals

The process of assessing the value, performance, or quality of an item or employee.

Exchange

The act of giving one thing and receiving another, especially of the same type or value, in return.

Things Of Value

Items, services, or concepts that hold worth or usefulness to individuals or organizations.