We talk about making a lot of high probability neutral bets.  It's very hard to stay completely delta neutral, meaning 0 delta because markets move, and so do our deltas.  If you have -65 delta beta weighted to the SPY, that is like being SHORT 65 shares of SPY.  If you are +65 delta beta weighted to the SPY it's like being LONG 65 share of SPY. So it's just a representation of how exposed you are to the markets moving.

Additionally, each position will have either negative deltas or positive deltas. If your position has a -50 delta, that means that your position will benefit from a move down in your underlying. If your position has a +50 delta, your position would benefit from a move up. If your position has a delta of 0, your position is currently neutral.

Note: Typically we look at our portfolio as a whole compared to the SPY. If our portfolio becomes too long, we will add short deltas to get closer to 0.

To learn more about beta weighting click here.

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