option premium

The price of an option the sum of money that the option buyer pays and the option seller receives for the rights granted by the option. Chicago Board of Trade glossary
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The option price. Bloomberg Financial Dictionary
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It is the price paid by a buyer to acquire the option right. The amount is typically expressed as pence per share. London Stock Exchange Glossary

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option premium option premium premium1

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   The price paid for an option. The premium comprises the intrinsic value of the instrument plus time value of controlling that instrument for a set period. It is paid by the holder to the writer of the option.

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option premium UK US noun [C]
FINANCE, STOCK MARKET the price for an option (= the right to buy shares, etc. at a particular price)

Financial and business terms. 2012.

Look at other dictionaries:

  • Option premium — The option price. The New York Times Financial Glossary * * * option premium option premium ➔ premium1 * * *    The price paid for an option. The premium comprises the intrinsic value of the instrument plus time value of controlling that… …   Financial and business terms

  • Option Premium — 1. The income received by an investor who sells or writes an option contract to another party. 2. The current price of any specific option contract that has yet to expire. For stock options, the premium is quoted as a dollar amount per share and… …   Investment dictionary

  • Option premium — The option premium is the price the buyer of the options contract pays for the right to buy or sell a security at a specified price in the future.ee also*Option (finance) …   Wikipedia

  • option premium — pasirinkimo sandorio premija statusas Aprobuotas sritis išvestinių finansinių priemonių rinka apibrėžtis Kaina, mokama už teisę, sudarius pasirinkimo sandorį, įsigyti arba parduoti turtą ateityje. atitikmenys: angl. option premium šaltinis… …   Lithuanian dictionary (lietuvių žodynas)

  • Option premium —   The price of an option contract paid by the option buyer to the option seller for the rights that are conveyed by the option …   International financial encyclopaedia

  • option premium — Fin the amount per share that a buyer pays for an option …   The ultimate business dictionary

  • Net Option Premium — The net amount an investor or trader will pay for selling one option, and purchasing another. The combination can include any number of puts and calls and their respective position in each. The net option premium can either be positive, which… …   Investment dictionary

  • option — [ ɔpsjɔ̃ ] n. f. • v. 1190; lat. optio 1 ♦ Faculté, action d opter. ⇒ choix. « La nécessité de l option me fut toujours intolérable » (A. Gide). « Ou pendus, ou noyés, nous n avions pas d autre option » (Hugo). ⇒ 1. alternative. Matières, textes… …   Encyclopédie Universelle

  • 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

  • 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… …   Financial and business terms

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