How Do “Greeks” like Delta and Gamma Influence a Trader’s Decision to Liquidate?

Delta measures the option price sensitivity to the underlying asset price. Gamma measures the rate of change of Delta.

As a losing option moves deeper Out-Of-The-Money, Delta approaches zero, and the option becomes less sensitive to price changes. This realization of a rapidly dying position, coupled with high Gamma risk near expiration, often forces a rational, albeit painful, decision to liquidate.