What do 'Greeks' refer to in the context of futures and options?

In the context of futures and options, 'Greeks' refer to the various measures that quantify the different types of risks involved in trading these financial instruments. Specifically, Greeks are used to assess how the price of an option or a futures contract will change in response to different factors, such as changes in the underlying asset's price, time decay, and volatility.

For instance, Delta measures how much an option's price is expected to change with a $1 change in the price of the underlying asset. Gamma measures the rate of change of Delta for a $1 change in the underlying price, providing insight into how Delta itself might change as the market moves. Other Greeks such as Theta and Vega measure the sensitivity of the option's price to time decay and volatility respectively. Understanding these metrics is crucial for traders as they help in making informed decisions about risk management and strategy formulation.

The other options do not align with the specific definition of Greeks in trading. Classifying types of commodities or investing in foreign currencies does not involve the analytical measures of risk that Greeks provide. Similarly, while derivatives encompass options and futures, the term 'Greeks' is particularly focused on the risks and sensitivities associated with these financial instruments rather than categorization or definition of the instruments