Using options theta and delta for calculating leverage over underlying?

External question — Quantitative Finance Stack Exchange Author: Hasselhoff Original post: https://quant.stackexchange.com/questions/80328 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. New to options and primarily interested in their value for leverage. Wondering if any one uses k*theta as well as delta when calculating the leverage factor. With k being some time normalizing constant. Say I want to buy IWM Call strike 220 with delta = .246, theta = -.084, spot = 212 If spot moves to 213 we should expect the value of the contract to increase by .246 * 100 = 24.6 using delta only. But we also know that if we hold the option for the whole trading day, the price of the contract will loose .084 so then we actually expect the value of the contract to increase by (.246 -.084) * 100 = 16.2 if we hold theta constant. Since theta has such significant impact on the leverage, should I be considering it, or is theta already baked into the estimate of delta or am I just wrong somehow?

External answer — Quantitative Finance Stack Exchange Author: Hasselhoff Original post: https://quant.stackexchange.com/a/80343 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. This is the answer I was looking for in general. https://quant.stackexchange.com/a/53362/24697 This is a an empirical estimate of delta in terms of the call and spot price (co)variance.