What is DEX?

Delta Exposure (DEX) measures the net directional exposure of options dealers. It represents the total stock-equivalent position market makers must hold to hedge their books. It provides insight into the aggregate directional bias of the options market.

How to Interpret It

A high positive DEX value suggests that market makers are net short delta (i.e., they have sold more calls than puts on a delta-adjusted basis). To hedge, they must buy the underlying asset as its price rises, which can accelerate a rally. Conversely, a large negative DEX indicates dealers are net long delta and will sell as the price rises, potentially dampening a rally and accelerating a sell-off.

Practical Applications

• Gauge the market's overall directional bias based on options positioning.
• Identify price levels where hedging flows could either accelerate or decelerate trends.
• Use in conjunction with GEX to build a more complete picture of dealer positioning and potential volatility regimes.