Skip to main content
Learn

How Does Volatility Impact the Premium Received When Selling a Call Option?

Higher implied volatility increases the option premium because it suggests a greater probability of the option expiring in-the-money.
Greeks.Live03.11.25

How Does Volatility Impact the Premium Received When Selling a Call Option?

Higher implied volatility (IV) significantly increases the premium of a call option. IV reflects the market's expectation of future price swings.

Since a higher volatility means a greater chance the option will expire in-the-money, option sellers demand a larger premium to compensate for this increased risk. Lower volatility reduces the premium.

How Does Implied Volatility Affect Option Premiums?
How Does the Relationship between Delta and the Probability of an Option Expiring In-the-Money Affect Trading Strategy?
Define Implied Volatility (IV) and Contrast It with Historical Volatility (HV).
What Is the Relationship between Delta and the Probability of an Option Expiring In-the-Money?

About

Contact

Editorial Policy

Terms of Service

Privacy Policy

Cookie Policy

© 2025 Greeks.Live

All Rights Reserved

Greeks.Live RFQ

Build by Noo on Engine

Source: The content on this website is produced by Greeks.live's proprietary analysis systems, which utilize advanced Large Language Models (LLMs). This information might not be subject to a full human review before publication and may contain errors.
Responsibility: You should not make any financial decisions based solely on the content presented here. We strongly urge you to conduct your own rigorous due diligence and to consult a qualified, independent financial advisor.
Purpose: All information is intended for informational purposes only. It should not be construed as financial, investment, trading, or any other form of professional advice. News and data are not trading signals.
Risk: The cryptocurrency, derivatives, and options markets are highly volatile and carry significant risk. By using this site, you acknowledge these risks and agree that Greeks.live and its affiliates are not responsible for any financial losses you may incur.