Skip to main content
Learn

Why Is Theta Typically Negative for a Long Option?

Theta is negative for a long option because time decay reduces its value.
Greeks.Live22.11.25

Why Is Theta Typically Negative for a Long Option?

Theta is typically negative for a long option position (buying a call or put) because time decay reduces the option's value over time. Since the option buyer wants the option's value to increase, the daily erosion of time value represents a loss for them, hence the negative Theta.

Why Is Theta Typically Negative for a Long Option Position?
What Role Does Theta Play in the Decay of an Option’s Extrinsic Value?
In Options Trading, How Does the Concept of “Time Decay” (Theta) Affect the Value of a Derivative?
How Does Theta Affect the Value of an Option as Expiration Approaches?

About

Contact

Editorial Policy

Terms of Service

Privacy Policy

Cookie Policy

© 2025 Greeks.Live

All Rights Reserved

Greeks.Live RFQ

Build by Noo on Engine

Source: The content on this website is produced by Greeks.live's proprietary analysis systems, which utilize advanced Large Language Models (LLMs). This information might not be subject to a full human review before publication and may contain errors.
Responsibility: You should not make any financial decisions based solely on the content presented here. We strongly urge you to conduct your own rigorous due diligence and to consult a qualified, independent financial advisor.
Purpose: All information is intended for informational purposes only. It should not be construed as financial, investment, trading, or any other form of professional advice. News and data are not trading signals.
Risk: The cryptocurrency, derivatives, and options markets are highly volatile and carry significant risk. By using this site, you acknowledge these risks and agree that Greeks.live and its affiliates are not responsible for any financial losses you may incur.