What is gamma exposure (GEX)?

Somebody sold you that option, and to survive it they have to keep buying and selling the underlying stock all day. Gamma exposure is an attempt to add up how much stock, across every contract on the board. It explains a real mechanism — and it rests on one assumption you should know about before you trust the number.

Start with one option and one hedge

A market maker sells you a call on a $100 stock. They do not want a bet on direction; they want the spread. So they buy stock to offset the call they are now short. How much stock? That is delta — the number of shares the option currently behaves like. An at-the-money call has a delta near 0.50, so one contract (100 shares) needs about 50 shares of hedge.

Here is the problem: delta does not stay put. If the stock rallies, the call starts behaving more like stock and its delta climbs toward 1.00. Now the dealer's 50 shares are not enough and they must buy more. If the stock falls, delta drops and they must sell. The rate at which delta changes as price moves is gamma, and it is the reason hedging is a continuous activity rather than a one-off trade.

The direction of the flow is the whole point

Whether that hedging calms the market or feeds it depends on which side of the gamma the dealer is on.

• Dealer long gamma (positive). Price rises, their delta rises above the hedge, so they sell stock. Price falls, they buy. The flow leans against whatever just happened. Ranges compress, rallies stall, dips get bought back — mechanically, with no opinion involved.
• Dealer short gamma (negative). Every rally forces them to buy and every dip forces them to sell, in the same direction the market is already going. Moves extend instead of fading, and afternoons get faster.

That is the mechanism the whole GEX industry is built on, and the mechanism itself is not controversial: hedging flows are real, they are large, and they are forced.

The arithmetic, written out

Take a $100 stock and one call struck at $100, thirty days out, with implied volatility of 25%. A standard option-pricing model puts that contract's gamma at about 0.0556. Suppose 10,000 of them are outstanding.

gamma per share                     = 0.0556
contracts outstanding               = 10,000
shares per contract                 = 100

delta change per $1 move
  = 0.0556 x 10,000 x 100           = 55,600 shares

the stock is $100, so a 1% move is $1

dollar gamma per 1% move
  = 55,600 shares x $100            = $5.56 million

So a single 1% move obliges the dealers holding that one strike to trade roughly $5.6 million of stock just to stand still. Do that for every strike and every expiration, count calls as positive and puts as negative, and you get the market-wide figure quoted as net GEX per 1% move. The general form is:

GEX = sum over all contracts of
        gamma x open interest x 100 x spot^2 x 0.01
      with calls positive and puts negative

Net, gross, flip and walls

Four numbers appear on every GEX page here, and they answer different questions.

• Net GEX is calls minus puts. Its sign is the headline: positive means the damping regime, negative the amplifying one.
• Gross gamma adds everything up ignoring sign. It measures how much hedging is going on in total. A small net inside a huge gross means the two sides nearly cancel — and that a modest shift in positioning could flip the sign.
• The gamma flip is the price where net gamma would cross zero. Distance to the flip is the useful part: sitting on top of it means the regime is unstable and could change on any ordinary session.
• Gamma walls are the individual strikes holding the most gamma. Hedging intensifies near them, which is why heavy strikes often behave like speed bumps.

The assumption you have to know about

Every free GEX number, including ours, assumes that dealers are long every call and short every put. That is a convention, not a measurement. Open interest tells you how many contracts exist; it does not tell you who is holding which side. If a large customer happens to be short calls and long puts on a name, the true dealer position is the opposite of what the convention assumes, and the sign of the estimate is simply wrong for that ticker.

Stacked on top of that:

• End-of-day inputs. Open interest settles overnight. GEX cannot update intraday, whatever a live-looking dashboard implies.
• A simplified pricing model. We use Black-Scholes with a zero interest rate and no dividends, which is the common public convention. It is close enough for shape, not for precision.
• Real books are not one product. A market maker hedges an equity option book with futures, other expirations, ETFs and correlated names. None of that is visible in a single ticker's open interest.
• The number is not the mechanism. Hedging flows are real; the aggregate estimate of them is fuzzy. Trust the sign and the rough magnitude, not the decimal places.

How to use it without fooling yourself

• Set expectations, not entries. A negative-gamma reading is a reason to expect wider ranges and to size accordingly, not a reason to be short.
• Watch the distance to the flip, not just the sign. A regime with a wide cushion is durable; one hovering at the flip can invert tomorrow.
• Check the expiration table. Most gamma usually sits in the nearest contracts, so the whole picture can reset the day after a big expiry.
• Cross-check it. When gamma positioning and max pain point at different levels, that disagreement is more informative than either number alone.

Live gamma exposure levels

Every ticker with a chain deep enough to estimate gamma — 50 of them, 26 currently reading positive. Computed nightly from end-of-day open interest and closing quotes. Latest snapshot in this table: 2026-07-23.

All tickers, including those without a GEX estimate

Read next

What is max pain? works through the other calculation built on the same open interest — the expiry-payout balance point — by hand. Max pain vs gamma exposure compares the two directly and shows what a disagreement between them is actually telling you.

Gamma exposure here is a derived estimate computed nightly from end-of-day open interest and closing quotes using a Black-Scholes approximation with zero rate and zero dividend (how we compute it). Not raw market data, not a live quote. Educational only: not investment advice, not a recommendation, not a price forecast.