Intrinsic vs Extrinsic Value

Breaking Down an Option's Price

Every option's premium can be decomposed into exactly two components: intrinsic value and extrinsic value (also called time value). Understanding this breakdown is fundamental to knowing whether an option is fairly priced and how it will behave over time.

Registrati per continuare a imparare

Crea un account gratuito per accedere a più corsi.