Theta

Theta is one of the options Greeks — it measures how much value an option is expected to lose per day purely from time passing, with the stock price and everything else held constant. It's often described as the daily "rent" an option pays just for existing. Theta isn't a flat, steady charge: decay is slow when an option has many weeks or months left, and accelerates sharply in the final days and weeks before expiration. Theta works against an option buyer, who loses value every day the stock doesn't move in their favor, and works in favor of an option seller, who collects that same decay as time passes with no adverse move. Theta describes only the time-decay effect in isolation — it doesn't account for the stock price moving, which can offset or overwhelm several days of decay in a single session.