volatility

Greeks & IV Explained

The Greeks & IV tab helps you understand why an options trade performed the way it did.

Instead of showing Greeks only when you enter a trade, the Journal compares them at Entry and Exit. Think of it as a before-and-after view of your trade.

Net Delta — Direction

Delta shows how sensitive your position was to movement in the underlying stock.

• Positive Delta benefits from an upward move.
• Negative Delta benefits from a downward move.
• A move toward zero generally means directional exposure decreased.

Comparing Entry to Exit helps show whether stock movement became more or less important as the trade progressed.

Net Theta — Time Decay

Theta estimates how much the position gains or loses from the passage of time each day.

• Premium-selling strategies generally benefit from positive Theta.
• Premium-buying strategies generally pay Theta as time passes.

Rather than showing only how the daily Theta rate changed, the Journal identifies whether time decay was collected or paid during the trade.

Net Vega — Implied Volatility

Vega measures how changes in implied volatility affected the position.

• Long options generally benefit when IV rises.
• Short-premium positions generally benefit when IV falls.

The Journal summarizes whether volatility:

• Worked in your favor
• Hurt the trade
• Faded as the position approached expiration or lost remaining premium

Net Gamma — Delta Sensitivity

Gamma measures how quickly Delta can change as the underlying moves.

Higher Gamma means your directional exposure can change more quickly, particularly as expiration approaches.

For most trade reviews, Gamma provides additional context about how sensitive the position became to price movement.

Understanding Volatility

Trade IV

Trade IV is the implied volatility associated with the option contracts in your trade.

It reflects the volatility being priced into the specific strikes you bought or sold.

Stock IV

Stock IV represents the broader implied volatility of the underlying stock.

Comparing Trade IV with Stock IV can help show whether your specific options were priced with more or less volatility than the stock’s overall option market.

Stock HV

Historical Volatility (HV) measures how much the stock actually moved over the previous 30 days.

Think of it this way:

IV = expected volatility
HV = actual recent volatility

IV − HV

IV − HV compares the volatility the options market was pricing with the volatility the stock actually experienced.

• Positive: IV was higher than HV.
• Negative: HV was higher than IV.

For premium sellers, a positive difference can indicate that options were pricing in more movement than the stock had recently been delivering.

IV Rank

IV Rank shows where the stock’s current implied volatility falls within its own 1-year range, from 0 to 100.

• A higher IV Rank means volatility is relatively high for that stock.
• A lower IV Rank means volatility is relatively low.

This gives IV some context. A 30% IV may be high for one stock and low for another.

Reading the Results

The Change column helps you quickly see what happened between Entry and Exit.

Some rows show a numeric change, while Theta and Vega use words such as collected, paid, worked, hurt, or faded to make the result easier to interpret.

Colors provide another quick reference:

• Green — helped the trade
• Red — hurt the trade
• Gray — neutral or informational

A negative number is not automatically bad. For example, Delta moving closer to zero may be favorable for a short-premium trade.

Putting It All Together

When reviewing the Greeks & IV tab, ask yourself:

Did price movement help or hurt?
Look at Delta.

Did time work for or against me?
Look at Theta.

Did changes in volatility help or hurt?
Look at Vega and Trade IV.

Was volatility relatively high or low when I entered?
Look at IV Rank and IV − HV.

Taken together, these numbers help answer the most important question:

Did the trade work for the reason I expected it to?