Which statement accurately describes a characteristic of gamma?

Gamma is a critical concept in options trading, specifically when analyzing the sensitivity of an option's delta relative to changes in the underlying asset's price. It quantitatively represents the rate of change of delta with respect to a change in the underlying asset’s price. Since delta measures how much the price of an option is expected to move for a $1 change in the price of the underlying asset, gamma provides insight into how stable or fluctuating that delta will be as the underlying price varies.

A higher gamma suggests that delta can change dramatically as the underlying asset price moves, indicating that adjustments to delta hedging may be necessary more frequently. Thus, understanding gamma is essential for effective delta hedging strategies, as it informs traders about the convexity of an option's price curve in relation to the underlying's movements. In short, gamma’s role in reflecting the change in delta as the underlying price changes is why the explanation provided in the chosen answer is correct.