Understanding Option Premiums
The premium (price of the option) is determined by:
🧮 Intrinsic Value + Time Value
Intrinsic Value: The actual amount by which an option is in the money.
Time Value: Additional value based on time until expiry and volatility.
📈 Factors Affecting Premiums (Option Pricing):
Stock Price
Strike Price
Time to Expiry
Volatility (Implied Volatility)
Interest Rates
Dividends
This pricing is calculated by complex models like Black-Scholes.
Options Greeks: Measuring Risk
"Greeks" help traders understand the sensitivity of an option’s price to various factors:
Greek Measures...
Delta Sensitivity to price change of the underlying
Gamma Change in delta for each ₹1 move
Theta Time decay—loss in value per day
Vega Sensitivity to volatility
Rho Sensitivity to interest rate changes
The premium (price of the option) is determined by:
🧮 Intrinsic Value + Time Value
Intrinsic Value: The actual amount by which an option is in the money.
Time Value: Additional value based on time until expiry and volatility.
📈 Factors Affecting Premiums (Option Pricing):
Stock Price
Strike Price
Time to Expiry
Volatility (Implied Volatility)
Interest Rates
Dividends
This pricing is calculated by complex models like Black-Scholes.
Options Greeks: Measuring Risk
"Greeks" help traders understand the sensitivity of an option’s price to various factors:
Greek Measures...
Delta Sensitivity to price change of the underlying
Gamma Change in delta for each ₹1 move
Theta Time decay—loss in value per day
Vega Sensitivity to volatility
Rho Sensitivity to interest rate changes
Hello Everyone! 👋
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
관련 발행물
면책사항
이 정보와 게시물은 TradingView에서 제공하거나 보증하는 금융, 투자, 거래 또는 기타 유형의 조언이나 권고 사항을 의미하거나 구성하지 않습니다. 자세한 내용은 이용 약관을 참고하세요.
Hello Everyone! 👋
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
관련 발행물
면책사항
이 정보와 게시물은 TradingView에서 제공하거나 보증하는 금융, 투자, 거래 또는 기타 유형의 조언이나 권고 사항을 의미하거나 구성하지 않습니다. 자세한 내용은 이용 약관을 참고하세요.