Options University Blog

Omega is a measure of the change in an option’s value with respect to the percentage change in the underlying price. It gives the option investors an idea of how the option price and the underlying stock price move together.
Omega is the third derivative of the option price, and the derivative of gamma.
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Lambda is a ratio denoting the change occurring in the price of an option as compared to a 1% change the volatility of the option.
In other words, this is nothing but a partial derivative of an option’s price as compared to its volatility. Kappa, Vega and sigma are the synonyms for Lambda.
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Financial Engineering
When an existing design or financial product is repackaged into a new form by the use of new concepts and tools, it is called financial engineering
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