Vega

Vega,

Definition of Vega:

  1. (in Spain and Spanish America) a large plain or valley, typically a fertile and grassy one.

  2. Measure of the sensitivity (rate of change) of an options price to the change in the price of the underlying asset.

Meaning of Vega & Vega Definition

Vega,

Vega:

  • Vega is a measure of the price sensitivity of the option to changes in the underlying asset fluctuations. Vega represents the amount under which the value of an option contract changes in response to a 1% change in the underlying volatility of the underlying asset.

    • Vega measures the value of an option in relation to changes in the underlying volatility of the underlying asset.
    • The long option has a positive vega, while the short option has a negative vega.

Meanings of Vega

  1. (Spain and Latin America) A vast plain or valley, usually fertile and grassy.

  2. For observers in the northern hemisphere, the fifth brightest star in the summer sky and the brightest star in the constellation Lira.