Basics of Options Trading FAQs

What does time value of an Option mean ?

Time value is the difference between an option's premium and its intrinsic price. All options at Out of The Money and At The Money have a time value.

Time Value = Premium – Intrinsic Value

Call option

Intrinsic Value = Current price for underlying - Strike Prices

For put option

Strike Price = Intrinsic Value - Current price for underlying

The Option's time value will increase the longer it takes to expire. The expiration time is zero.

 


What does Assignment in Options mean ?


What is the difference between Options and Futures ?


What are the elements that can change the value of the premium of an Options ?


What are various pricing models for Options ?


How can we calculate the premium paid on Options ?


What does Option Greeks mean and how it is used in Option trading ?


In Options trading ,What is selling \ writing or shorting means ?


How to settle an option that I have bought and paid the premium ?


Do Stock buyers and Options buyers have the same rights ?


In India what is the cycle of contract for Options ?


How the price of an Option is affected by the probability of price movement ?


How are trading stocks different from options ?


What does volume and open interest mean in options ?


What does options market mean ?


What does nifty options and futures mean?


Is it possible to trade in US options from India ?


What are options trading timing in India ?


What is the expiry date of NSE ?


Can I buy or sell of Options in pre - market trading session ?


What does call and put option in bank nifty mean ?