In options trading, assessing intrinsic and extrinsic value can help determine an option's price. Intrinsic value shows the profit from immediate exercise, while extrinsic value accounts for factors ...

Learn how option premiums are determined by factors like stock price, time to expiration, and volatility. Master the basics to trade options wisely and confidently.

In options trading, the extrinsic value of an option represents the portion of the option's price that's based on factors other than the immediate value of exercising it. Also known as “time value,” ...