Kappa Key to Measuring Option Sensitivity to Volatility
1682 reads · Last updated: November 21, 2025
Kappa is the measurement of an option contract's price sensitivity to changes in the volatility of the underlying asset. Volatility accounts for recent changes in price, historical changes in price, and future price moves. For a trading instrument, like an option, volatility is intended to capture the amount and speed at which the price moves up and down.
