In trading Delta hedging is a way to structure an option play to decrease or even eliminate the directional risk exposure of a stock holding or other option contracts. Stocks and options have directional exposure to a move in the market price, this is called Delta which is reflected by how much money a position makes or loses on every $1 move in the stock or underlier of an option contract. If an at-the-money call option moves .50 cents for every $1 the underlying stock moves it is said to have a .50 Delta. A long stock position with no hedge would have a positive 1.00 Delta. A short stock position with no hedge ... (full story)