Does an Option’s Premium Ever Equal Its Intrinsic Value before Expiration?
Theoretically, an option's premium will rarely equal its intrinsic value before expiration because of the time value component. Even with a very short time remaining, there is usually some non-zero time value due to the possibility of a final price move.
However, for deep ITM options very close to expiration, the time value can be negligible, making the premium very close to the intrinsic value.
Glossar
Time Value
Component ⎊ Time value, also known as extrinsic value, is a component of an option's premium that reflects the probability of the underlying asset's price moving favorably before the option expires.
Intrinsic Value
Valuation ⎊ This represents the in-the-money amount of an option, calculated as the difference between the spot price and the strike price, if positive, otherwise zero.
Before Expiration
Horizon ⎊ The temporal window preceding an option's final settlement date dictates the rate of time decay, or theta.