# Pricing and volatility

What moves the price of an option between the day it is traded and the day it expires, and how each effect is measured.

Canonical page: https://optionsbeacon.pro/learn/topics/pricing

1. [Delta](https://optionsbeacon.pro/learn/delta.md): Delta is the estimated change in the price of an option for a rise of $1 in the price of the underlying stock. The delta of a call lies between 0 and 1 and the delta of a put between -1 and 0.
2. [Theta and time decay](https://optionsbeacon.pro/learn/theta-time-decay.md): Theta is the estimated change in the price of an option as one day passes and everything else stays the same. Time decay is the loss of time value that theta measures.
3. [Implied volatility](https://optionsbeacon.pro/learn/implied-volatility.md): Implied volatility is the volatility that, put into an option pricing model, gives the market price of the option. It is quoted as a yearly percentage and says how much movement of the stock the premium pays for.

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Educational content from Options Beacon. It is not investment, tax or legal advice, and not a recommendation to buy or sell any security or to use any strategy. Options involve risk and are not suitable for all investors; an option seller can lose far more than the premium received. Before trading options, read [Characteristics and Risks of Standardized Options](https://www.theocc.com/company-information/documents-and-archives/options-disclosure-document).

Articles are drafted with AI assistance and checked against the sources listed on each page.