Vega

Vega is a measure used in options trading that indicates how much an option's price is expected to change when the volatility of the underlying asset increases by 1%. In other words, vega helps traders understand how sensitive an option’s value is to changes in market volatility. If volatility rises, options with high vega tend to become more valuable, while those with low vega are less affected. It’s a valuable tool for assessing risk and potential price movement based on how volatile the market is expected to be.