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How Does a Longer Time to Expiration Affect the Option Premium?

Longer time increases the probability of a favorable price move, thus increasing the option's extrinsic value and premium.
Greeks.Live02.11.25

How Does a Longer Time to Expiration Affect the Option Premium?

A longer time to expiration generally increases the option premium. This is because more time provides a greater probability for the underlying asset's price to move favorably, making the option ITM.

This increased probability translates into a higher extrinsic (time) value.

How Does Time to Expiration Affect an Option’s Vega?
Why Do Options with Longer Time to Expiration Have Lower Daily Theta?
If an Option’s Premium Is 0.05 BTC and Its Intrinsic Value Is 0.02 BTC, What Is Its Time Value?
What Is “Extrinsic Value” or “Time Value” in an Option’s Premium?

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