Premium


Premium
(1) Amount paid for a bond above the par value. (2) The price of an option contract; also, in futures trading, the amount the futures price exceeds the price of the spot commodity. Related: inverted market premium payback period. Also called break-even time, the time it takes to recover the premium per share of a convertible security. The New York Times Financial Glossary

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I. premium pre‧mi‧um 1 [ˈpriːmiəm] noun [countable]
1. INSURANCE a payment that you make for insurance:

• Some insurance companies offer small sum policies, with monthly or annual premiums.

single premium life insurance policies

• Car insurance premiums shot up by almost a quarter.

reˈnewal ˌpremium
INSURANCE a sum of money charged for making an insurance policy continue for a further period of time:

• Fill in the tear-off slip and send it with your renewal premium to the address below.

2. an additional amount of money, above a standard amount or rate:

• The company's earnings will grow by about 25% a year and investors will be willing to pay a premium (= pay more than usual ) for that growth.

• As long as there is a threat of war in the Middle Eastern oil fields, oil prices will command a premium (= buyers will have to pay more than usual ) .

ˈbond ˌpremium
FINANCE the amount by which the price paid for a bond is more than its actual value
conˈversion ˌpremium
FINANCE an increase in value to an investor when one form of investment in a company is exchanged for another:

• The debentures are convertible into common stock at $18.14 a share, representing an 18% conversion premium over yesterday's closing price.

moˈbility ˌpremium HUMAN RESOURCES
money paid to important international businessmen when they have to move from one country to another because of their jobs
ˈoption ˌpremium
FINANCE the price paid for an option (= the right to buy shares, bonds etc at a particular price in the future):

• Commissions on option trades run about 2% to 5% of the option premium.

3. at a premium if something is at a premium, there is little of it available or it is difficult to obtain:

• With parking space at a premium in Japanese cities, the microcar is a popular form of transport.

4. at a premium (to something) if one thing is sold at a premium to another, it costs more:

• Platinum usually trades at a premium to gold.

5. put/​place a premium on something if you put a premium on something, you consider it to be especially valuable:

• Employers today put a premium on reasoning skills and willingness to learn.

  [m0] II. premium premium 2 adjective [only before a noun] MARKETING
premium products, goods etc are of higher quality than usual:

Premium brands of beer will grow faster, in line with the trend toward people demanding better quality.

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   Premium is generally used to describe when something is trading above its normal price. An asset or fund is described as being at premium when its market price is above its face value. In the capital markets, it is the amount by which a bond sells above par. In foreign exchange terms, it is the margin by which the forward rate is higher than the spot. In commodity markets it is the additional price paid by a consumer when the delivered commodity is of better quality than that specified in the original contract. Premium is the opposite of discount.
   ► See also Discount, Par Value.

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Ⅰ.
premium UK US /ˈpriːmiəm/ noun [C]
an amount of money that is more than usual: »

We're willing to pay a premium for the best location.

attract/command a premium »

BMW, Mercedes, Volvo, and even Volkswagen have usually commanded a premium because they are seen as stylish.

HR, WORKPLACE PREMIUM PAY(Cf. ↑premium pay)
INSURANCE INSURANCE PREMIUM(Cf. ↑insurance premium)
See also SHARE PREMIUM(Cf. ↑share premium)
at a premium — Cf. at a premium
put a premium on sth — Cf. put a premium on sth
See also OPTION PREMIUM(Cf. ↑option premium)
Ⅱ.
premium UK US /ˈpriːmiəm/ adjective
of very high quality: »

The premium package also provides higher screen resolution.

»

All high street banks offer some sort of ""premium banking service"" to wealthier customers.

very high, or higher than usual: »

Experts advise businesses to switch to producing quality goods, which will be desirable to customers even at a premium price.


Financial and business terms. 2012.

Synonyms:

Look at other dictionaries:

  • premium — pre·mi·um / prē mē əm/ n 1: the difference between the face value or par value of a security and its market price when the latter is greater compare discount 2: the price paid for an insurance contract equal to the cost per unit times the number… …   Law dictionary

  • premium — [ premjɔm ] n. m. • XXe; mot lat. « butin » ♦ Fin. Prime versée pour une opération sur un marché à terme. ⇒ option. On écrirait mieux prémium. ● premium nom masculin (latin praemium, butin) Somme payée au vendeur d une option d achat (ou de… …   Encyclopédie Universelle

  • premium — premium, prize, award, reward, meed, guerdon, bounty, bonus are comparable when they mean something which is bestowed upon a person as a recompense for cooperation, greater effort, superior merit, or supremacy in competition. Premium is applied… …   New Dictionary of Synonyms

  • Premium — Pre mi*um, n.; pl. {Premiums}. [L. praemium, originally, what one has got before or better than others; prae before + emere to take, buy. See {Redeem}.] 1. A reward or recompense; a prize to be won by being before another, or others, in a… …   The Collaborative International Dictionary of English

  • premium — ► NOUN (pl. premiums) 1) an amount paid for a contract of insurance. 2) a sum added to an ordinary price or other payment. 3) (before another noun ) (of a commodity) superior and more expensive. ● at a premium Cf. ↑at a premium …   English terms dictionary

  • premium — [prē′mē əm] n. pl. premiums [L praemium, reward, recompense < prae , before + emere, to take: see PRE & REDEEM] 1. a reward or prize, esp. one offered free or at a special low price as an added inducement to buy or do something; bonus 2. an… …   English World dictionary

  • premium — [adj] excellent choice, exceptional, prime, select, selected, superior; concept 574 Ant. inferior, low, low class, poor premium [n] bonus, prize appreciation, boon, bounty, carrot*, dividend, extra, fee*, gravy*, guerdon, meed, percentage, perk* …   New thesaurus

  • Premĭum — (engl., abgekürzt pm.), Prämie, auf englischen Kurszetteln im Gegensatz zum damno oder discount (abgekürzt dis.) soviel wie Aufgeld, Überschuß über den Paribetrag …   Meyers Großes Konversations-Lexikon

  • premium — (n.) c.1600, reward given for a specific act, from L. praemium reward, profit derived from booty, from prae before (see PRE (Cf. pre )) + emere to buy, originally to take (see EXEMPT (Cf. exempt)). Insurance sense is 1660s, from It. premio.… …   Etymology dictionary

  • premium — consideration paid for an insurance policy. Glossary of Business Terms (1) The additional payment allowed by exchange regulation for delivery of higher than required standards or grades of a commodity against a futures contract. (2) In speaking… …   Financial and business terms


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