Hi guys, In sensibull they give THETA and DECAY separately, for a perticular strategy. Can anyone tell me what is the difference between the two. Description wise, I feel both are same but the amount mentioned against each of these 2 parameters are different. Can anyone throw some light on this?
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Theta is theoretical time decay assuming IV stays constant. while Decay factors in the actual time gap till the next trading session, so it effectively includes weekends and holidays, along with IV adjustments, so both feel the same, but values differ.