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What Is the Primary Risk of Buying an OTM Option?

The primary risk is losing the entire premium if the option expires worthless.
Greeks.Live22.11.25

What Is the Primary Risk of Buying an OTM Option?

The primary risk of buying an Out-The-Money (OTM) option is losing the entire premium paid. Since OTM options have zero intrinsic value, the buyer is betting entirely on a favorable and significant price move before expiration to make the option ITM, otherwise it expires worthless.

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At What Point Does an OTM Option Become Worthless?
What Happens to the Value of an OTM Option at Expiration?

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