BackQuant Glossary
Dealer Positioning
The aggregate book of options market makers, estimated from public open-interest data and assumptions about who is naturally long or short each strike. Reading dealer positioning tells you whether their hedging will damp or amplify price action.
Related terms
ETH
Ethereum, the second-largest crypto asset by market cap and the second-largest options market. ETH options track BTC closely but show distinct skew and term-structure dynamics, especially around protocol-level catalysts.
Long
A position that profits when price rises. Buying spot, going long a perp, owning a call, or being short a put are all long positions. Opposite of short.
Market Maker
A participant that quotes both sides of the market continuously and earns the spread. In options, market makers also hedge their inventory in the underlying. Their hedging flow is the mechanical force behind gamma exposure effects.
Short
A position that profits when price falls. Selling spot, going short a perp, owning a put, or being short a call are all short positions. Short positions in crypto carry tail risk because upside is unbounded.
Dealer Hedging
The act of buying or selling the underlying to offset directional exposure created by an options book. Dealers stay delta-neutral by trading spot or perpetuals as price moves. Dealer hedging is the mechanical force behind gamma exposure effects, pinning, and OpEx flows.
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