01
The core difference
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DEX is the level: how much directional exposure the modelled dealer book carries, in rupees.
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GEX is the slope: how much that exposure changes for a 1% move in the index.
Delta is the first derivative of option value to spot, gamma is the second. DEX is built from delta, GEX from gamma, so one is a position and the other is its sensitivity.
02
The four combinations
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Positive GEX, positive DEX: Hedging dampens moves and the book leans long. Ranges and mean reversion are the usual description.
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Positive GEX, negative DEX: Moves are dampened but the book leans short, so rallies meet less hedge supply.
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Negative GEX, positive DEX: Moves are amplified and the book leans long, so falls meet hedge selling.
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Negative GEX, negative DEX: Moves are amplified and the book leans short. This is the combination associated with fast, one-directional sessions.
03
When they disagree
GEX and DEX can point in different directions because they come from different Greeks. Do not average them. Read GEX for regime, DEX for the direction of the existing hedge, and treat any disagreement as a reason for caution about both.
04
Frequently asked questions
Which is more important, GEX or DEX?
Neither alone. GEX gives the regime, DEX gives the size and sign of the existing directional hedge.
Do GEX and DEX use the same data?
Yes, both are built from NSE open interest and option prices, but from different Greeks.
Can both be positive and the market still fall?
Yes. Neither is a direction forecast.
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