What is GEX?

GEX — gamma exposure — is a measure of how much hedging activity dealers have to do as the underlying price moves. It's not predictive on its own, but it tells you where the market's hedge-driven flow is concentrated, which often shows up as suppressed (or accelerated) volatility around specific price levels.

The mechanic

When you buy a call, someone has to sell it to you. That someone — the dealer — is now short the call. To stay delta-neutral, the dealer hedges by buying some of the underlying. As price moves, their hedge has to be rebalanced. The size of that rebalance per dollar of price move is the position's gamma.

Sum every dealer-held option's gamma across all strikes and you get total dealer gamma exposure for that expiry. That's GEX.

Why dealer-position sign matters

Dealers are typically short the call wing (retail buys calls, dealers sell them). Short calls = short gamma. Short gamma means: when price rises, dealers must buy more underlying to stay hedged, which pushes price further up; when price falls, they must sell, which pushes it further down.

So short-gamma regimes amplify volatility. Long-gamma regimes do the opposite — dealer hedging dampens moves. The flip point between the two is the gamma flip, and crossing it is one of the few "regime change" signals you can read directly off positioning data.

What GEX charts show you

The dashboard plots GEX per strike for the selected expiry. Tall positive bars = long-gamma cluster (dampening). Tall negative bars = short-gamma cluster (amplifying). The sum across all strikes is the headline GEX number you see above the chart.

Compare with OI (open interest, contract count): OI tells you how big the position is. GEX tells you how reactive the dealer hedge is. They're related but not interchangeable — see the OI vs GEX page for the difference.

Caveats

• GEX assumes dealers are net short calls and net long puts. That's the empirical baseline for index options, including BTC and ETH. Edge cases (e.g., a major exchange running a directional book) can break the assumption.
• GEX is computed from public OI snapshots, not actual dealer books. It's a reasonable proxy for the typical retail-vs-dealer split, not ground truth.
• Greeks shift with IV. The same OI at higher IV produces higher gamma — so GEX rises when vol rises, even if positioning is unchanged.