option price


The amount per share that an option buyer pays to the seller. The option premium is primarily affected by the difference between the stock price and the strike price, the time remaining for the option to be exercised, and the volatility of the underlying stock. Affecting the premium to a lesser degree are factors such as interest rates, market conditions, and the dividend rate of the underlying stock. Because the value of an option decreases as its expiration date approaches and becomes worthless after that date, options are called wasting assets.
The total value of an option consists of intrinsic value, which is simply how far in-the-money an option is, and time value, which is the difference between the price paid and the intrinsic value. Understandably, time value approaches zero as the expiration date nears. also called option premium.

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You should always shop around and make sure you are getting the very best option price you can possibly get.

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An amount that is paid to a seller by a buyer after a transaction and the payment is made per share is known as OPTION PRICE

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Before you decide to partake in the world of trading, you should have a sound knowledge of the components that will determine the value or the option price.

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