# Theta and vega option trading

Vega for this option might be. Also, the price of near-term at-the-money options will change more significantly than the price of longer-term at-the-money options. That means if the stock goes up and no other pricing variables change, theta and vega option trading price of the option will go down.

If options are out-of-the-money, they will approach 0 more rapidly than they would further out in time and stop reacting altogether to movement in the stock. So as expiration approaches, changes in the stock value will cause more dramatic changes in delta, due to increased or decreased probability of finishing in-the-money. Theta and vega option trading investors may lose the entire amount of their investment in a relatively short period of time.

However, the loss may be greater percentage-wise for out-of-the-money options because of the smaller time value. That means if the stock goes up and no other pricing variables change, the price of the option will go down. So delta has increased from.

Of course it is. So delta has increased from. There is now a higher probability that the option will end up in-the-money at expiration. Since implied volatility only affects time value, longer-term options will have a higher vega than shorter-term options.

Also, the price of near-term at-the-money options will change more significantly than the price of longer-term at-the-money options. Options investors may lose the entire amount of their investment in a relatively short period theta and vega option trading time. But if your forecast is wrong, it can come back to bite you by rapidly lowering your delta.