Dictionary:

rho

  (rō)

The 17th letter of the Greek alphabet.

[Greek rhō, of Phoenician origin.]

The rate at which the price of a derivative changes relative to a change in the risk-free rate of interest. Rho measures the sensitivity of an option or options portfolio to a change in interest rate.

Investopedia Says:
For example, if an option or options portfolio has a rho of 12.124, then for every percentage-point increase in interest rates, the value of the option increases 12.124%.

Related Links:
We examine various ways in which companies use derivatives to manage risk. Corporate Use Of Derivatives For Hedging
Understand the various factors that influence them so you can learn to anticipate their movements for profit. Trying To Predict Interest Rates
Learn how analyzing these variables are crucial to knowing when to exercise early. Dividends, Interest Rates and Their Effect on Stock Options

(Symbol ρ) The 17th letter of the Greek alphabet.

The noun has one meaning:

Meaning #1: the 17th letter of the Greek alphabet

Rho (upper case Ρ, lower case ρ) is a letter of the Greek alphabet. See Rho (letter).

The lower-case letter rho (ρ) may represent:

• in mathematics, the radius in a spherical coordinate system
• in physics and engineering, the density of a material.
• in physics, the volume charge density.
• in physics, the resistivity of a material.
• in physics, the rho mesons, ρ ⁺ , ρ⁰, ρ ^- .
• in biology, the Rho factor protein in RNA transcription termination.
• in mathematical finance, Rho is the sensitivity of an option or to changes in interest rates.
• in statistics, the Spearman's rank correlation (or rho) coefficient.

Rho is the name of several places:

• Rho, a town near Milan, Italy (not to be confused with Ro, Italy)
• the Rho, a Greek islet famous for its single resident, Despina Achladioti.
• Rho River, a river in the Frejus Valley
• Rhodes Diagoras International Airport, IATA code

Other:

• in biology, Rho GTP-binding protein, a small GTPase enzyme important in migration and stress fibre formation
• The Durst Rho, a series of large-format industrial inkjet printer marketed by Durst
• The Right-Hand Opponent in Contract Bridge (see Contract bridge glossary)
• Rho Cassiopeiae, a yellow hypergiant in the constellation Cassiopeia.

See also

• RO, Ro, ro (disambiguation page)

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