Skip to main content

How Does the Premium Relate to the Option Type?

The premium is the price paid by the buyer to the seller for the option contract. It is determined by factors like the underlying asset's price, strike price, time to expiration, and volatility.

Generally, options that are In-The-Money (ITM) or have a longer time to expiration will command a higher premium, regardless of whether they are a call or a put.

How Is a ‘Synthetic Long Call’ Constructed Using the Underlying Asset and a Put Option?
What Is the ‘Premium’ in an Options Contract and What Factors Influence It?
How Is an Option’s “Premium” Calculated in the Crypto Market?
What Is a “Bear Put Spread” and How Does It Limit Risk Compared to Buying a Single Put?