Theta measures an option's:
A) intrinsic value.
B) volatility.
C) rate of time decay.
D) sensitivity to changes in the value of the underlying asset.
E) sensitivity to changes in the risk-free rate.

Name: Theta measures an option's: A) intrinsic value. B) volatility. C) rate of time decay. D) sensitivity to changes in the value of the underlying asset. E) sensitivity to changes in the risk-free rate.
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Question

Quizplus · Accepted Answer

Theta measures the rate of time decay or the decrease in an option's value due to the passage of time.

Theta Measures an Option's