Why Does a Long Put Option Have a Negative Delta?
A long put option gives the holder the right to sell the underlying asset at the strike price. Since the value of this right increases as the underlying asset's price falls, and decreases as the underlying price rises, the put option's price moves inversely to the underlying price.
This inverse relationship is mathematically represented by a negative Delta, ranging from -1 (deep ITM) to 0 (deep OTM).
Glossar
Long Put Option
Mechanism ⎊ A long put option within cryptocurrency derivatives represents the acquisition of the right, but not the obligation, to sell an underlying crypto asset at a predetermined price ⎊ the strike price ⎊ on or before a specified date, the expiration date.
Right to Sell
Exercise ⎊ A right to sell, within cryptocurrency derivatives, represents a contractual obligation granting the holder the option, but not the requirement, to divest an underlying asset at a predetermined price on or before a specified date.
Long Put
Position ⎊ A Long Put represents a bearish market position established by an options buyer who acquires the right, but not the obligation, to sell the underlying cryptocurrency asset at a predetermined strike price before or at expiration.
Long Put Position
Acquisition ⎊ A long put position is established by purchasing a put option contract, which grants the holder the right to sell the underlying cryptocurrency at a specified strike price before the expiration date.
Inverse Relationship
Correlation ⎊ Inverse relationships within cryptocurrency, options, and derivatives markets denote a negative covariance between asset prices or rates.