What Is the Maximum Intrinsic Value a Put Option Can Theoretically Reach?
The maximum intrinsic value a put option can theoretically reach is the option's strike price. This occurs if the underlying asset's price falls to zero.
In this scenario, the put option grants the holder the right to sell the worthless asset for the full strike price. In reality, the maximum intrinsic value is the strike price minus the minimum possible price of the underlying asset.
Glossar
Theoretical Maximum Intrinsic Value
Limit ⎊ The theoretical maximum intrinsic value for a call option is achieved when the underlying cryptocurrency price at expiration is infinitely higher than the strike price.
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.
Maximum Intrinsic Value
Value ⎊ Maximum Intrinsic Value for an option is achieved when it is exercised at the point where the difference between the underlying price and the strike price is maximized, which essentially occurs when the option is extremely deep in the money.
Strike Price
Reference ⎊ The Strike Price is the predetermined reference level set at the contract's inception against which the underlying crypto asset's spot price is compared at expiration or exercise.