Option premium

Option Premium
Option premium refers to the per-share amount that a buyer pays for an option - for the right to buy/"call" or sell/"put" a security at a specified price in the future.

Option Premium
The Option Premium is the price paid by a buyer of an Option.

option premium - Related Articles
Option Pricing
Calculations
There are two sorts of options in stock market trading: call and put.

Also called the option premium, the price paid by the buyer of the options contract for the right
to buy or sell a security at a specified price in the future.
control premium ...

Option Premium
The premium is the price at which the contract trades. The premium is the price of the option and is paid by the buyer to the writer, or seller, of the option.

Option Premium - this is the $100 hold money you paid. It's the cost to enter into this contract. This is not a deposit against the purchase price, but money the store will keep either way for providing you with the convenience.

Option Premium. The amount paid for an option.
Option. The right to buy (or sell) or lease a property at a certain price for a limited period of time. For example, you pay $2,000 for a option to purchase 20 acres of land for $200,000.

Option Premium
The "price" a buyer pays for an option. Premiums are arrived at through open competition between buyers and sellers on the trading floor of the exchange.
Option Seller ...

Option premium. The market price of an option that is paid by an option buyer to the option writer (seller) for the right to buy (call) or sell (put) the underlying security at a specified price (the "strike price" or "exercise price") at any ...

Option premium
When you buy an option, you pay the seller a nonrefundable amount, known as the option premium, for the right to exercise that option before it expires. If you sell an option, you receive a premium from the buyer.

Option premium
The option price.
Option price
Also called the option premium; the price the buyer of the options contract pays for the right to buy or sell a security at a specified price in the future.

Option Premium
The amount paid to enter into an option contract, paid by the buyer to the seller or writer of the contract.
Option Writer ...

Option premium
The option price.
Original Issue Discount securities (OIDS) ...

option premium The purchase price of an option.
option pricing theory The body of financial theory used by financial engineers to value options and other derivative instruments.

Option premium
The option price.
Call premium
Premium in price above the par value of a bond or share of preferred stock that must be paid to holders to redeem the bond or share of preferred stock before its scheduled maturity date.

Option premium The price.
Option price Also called the premium, the price paid by the buyer of the options for the right to buy or sell a at a specified price in the future.

Option PremiumExpand/Collapse
This is the price of an option. It is the amount of money that the option holder pays for the rights and the option writer receives for the obligations granted by the option.
Option WriterExpand/Collapse ...

Option Premium
1. The income received by an investor who sells or "writes" an option contract to another party.

The option premium is always greater than intrinsic value. This extra money is for the risk which the option writer/seller is undertaking. This is called the Time Value.

See: Option Premium; Options; Option Writer; Put Option
WT (Warrant)
A certificate that gives a shareholder the right to purchase a security at a specified price within a predetermined time period or perpetually.

The option premium is excluded in the aggregate exercise price. In the case of options traded on debt instruments, the aggregate exercise price is the exercise price of the underlying security multiplied by its face value.

option premium The amount per share that an option buyer pays to the seller, affected by the... option price See option premium. option pricing curve A graphical model of the price of an option as a function of time.

Option Premium
The 'price' of the option, paid by the buyer....(Read more)
Option Pricing Model
A mathematical model used to calculate the theoretical value of an option using inputs such as the price of the underlying instrument, the o...

technical analysis term used in measuring the interaction between the price of an option premium and the price of the underlying security or futures contract.

The institution may choose to report the gross proceeds, or the net proceeds (gross proceeds minus any commissions, option premiums, state or local transfer taxes, brokers' fees, etc.), in Box 2.

High volatility inflates the option premium and low volatility deflates the premium. The higher the volatility, the larger the range of price variation and hence, the greater the risk.

Gains derived from the sale of real or personal property (including market discount and option premiums, but not including original issue discount)
Items of income excluded from gross income, without regard to the U.S.

Part of the option premium which reflects the excess over the
intrinsic value, or the entire premium if there is no intrinsic value.
At given price levels the option's time value will decline until
expiration.

Time Value - The part of the option premium derived from the volatility and the time remaining until expiration. It is the part of the option premium that is NOT the intrinsic value.

Theta - Is the sensitivity of an option premium or price relative to changes in time. This characteristic tends be viewed on an instantaneous basis in financial literature and on a daily change basis in practice.

The investor who buys a vertical spread hopes to profit as the difference between the option premium on the two option positions widens or narrows. Also called a Price Spread. See also Option Premium.

» Strike Price, Listed Option, Option Premium
» Types of Options : American & European Options
» Hedging & Speculation ...

See also: Derivatives, In the Money, Out of the Money, At the Money, Option Holder, Option Writer, Option Premium, Omega, Barrier Option, Trigger Option, Look Forward Option, Straddle, Strangle, Butterfly Spread, Binary Option, Combined Option ...

See related: Covered call, Expiration date, Option premium, Strike price.
See opposite: Put option.
Call provision ...

Implied volatility
The derived volatility of an asset based on the option premiums quoted by other option traders in the market.

The expected expansion or contraction in an option premium given a small change in the value of the underlying security. Call options have positive deltas; put options have negative deltas. The delta may change as the option gets closer to its expiry.

IMPLIED VOLATILITY " A mathematical calculation made using one of the option evaluation models, which includes the option premium observed on the market, as well as other important factors to help determine the option's volatility.

Also known as time value. Extrinsic value is the price of an option minus its intrinsic value. As out of the money options have no intrinsic value, their option premium is based entirely on extrinsic value.
Fair Value or Theoretical Value ...

Time Value - The part of an option premium that is in excess of the intrinsic value.
...

Gearing
Gearing is a feature of leveraged instruments such as covered warrants, futuresand options. In an option, by investing a small amount called the option premium, investors can multiply their gains since returns are magnified. ...

Time Value
A phrase used in relation to options. Time value is any portion of the option premium over an above the intrinsic value.

Covered writer
An investor who writes options only on stock that he or she owns, so that option premiums may be collected.

Alternatively, it may be expressed in terms of the distance the stock could fall before the total position becomes a loss (an amount equal to the option premium), or it can be expressed as percentage of the current stock price.

these values are agreed, a price can be set and two parties can agree a contract - the option of selling/ buying something at a particular price at a specific future date, and the right to do this granted for a specific price (the option premium).

See also: Stock split, Limit Order, Debt service, Collar, Escrow