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What does Taylor Mason mean by predicting delta of a stock?

Personal Finance & Money Asked on August 2, 2021

A stock is like a living organism. A sparrow, say. And we are able to create an emergent-based abstraction of that sparrow, which closely approximates the sparrow itself, accounting for migration patterns, wind, weather, and other variables. We can create a similar abstraction of a stock combining the information from the specific ETFs, which represent its underlying dependencies. And if we apply this to the stock we can predict its delta, following the path of its extracted self, because nature follows abstraction.

  • Taylor Mason, Billions S02E10

I tried asking on quant se but no luck. I’m basically wondering if we can always predict a stock’s delta. I have a feeling the show might’ve been just saying a bunch of words to sound smart but then turned out incorrect. The thing is the stock’s delta should be either +1 or -1 depending on what position you are, namely, resp, long or short.

Related: Do stock splits make one's shares double in voting power?

3 Answers

You seem to be taking the definition of delta from options models, where "Delta" is the derivative of the option price with respect to the underlying price.

Delta in mathematics more generally means "change", so I interpret the statement to mean the change in the stock price, either the change over a period of time or the average incremental change, since their abstraction seems to be describing a "random walk".

Correct answer by D Stanley on August 2, 2021

It's a fictional TV show. "Predicting the delta of a stock" doesn't mean anything.

Answered by Tanner Swett on August 2, 2021

After reading the description, my first thought was that I should look for a screen saver of a sparrow.

My next thought is that you're quoting a non-binary character on the show Billions on American television? Really? That's the source of your financial information?

Yes, you are correct. A stock's delta is either +1 or -1.

Answered by Bob Baerker on August 2, 2021

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