Rho

Every family has a wallflower. The one who, at the family reunion, spends most of the day hiding out in the basement. For the Greeks, from the collection of concepts related to option trading (each one named for a Greek letter)...that wallflower is Rho.

Delta and gamma are the attractive go-getters who just got into Yale. Theta and vega are the artsy types whose bands have a single that just got featured on Grey's Anatomy. And then there's Rho. Poor, ignored Rho. Known only to deep-cut, option-trading nerds.

Rho measures the change in an option's price, compared to changes in a risk-free interest rate. It tracks how sensitive an option is to changes in interest rates. A Rho of 1.0 means that, if rates climb by one percentage point, the price of that option will increase one percent as well. Purchased calls have a positive Rho, while purchased puts have a negative Rho.