How Option Pricing Works
The price of an option (premium) depends on many factors:
1. Underlying Price
If the market moves in the option’s direction (up for call, down for put), the premium rises.
2. Strike Price
Closer the strike to current price, higher the premium.
3. Time to Expiry
More time → higher premium (more chances of movement)
4. Volatility
Higher volatility → higher premium.
5. Interest rates and dividends
These have minor effects but still influence pricing models.
The price of an option (premium) depends on many factors:
1. Underlying Price
If the market moves in the option’s direction (up for call, down for put), the premium rises.
2. Strike Price
Closer the strike to current price, higher the premium.
3. Time to Expiry
More time → higher premium (more chances of movement)
4. Volatility
Higher volatility → higher premium.
5. Interest rates and dividends
These have minor effects but still influence pricing models.
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Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Hello Everyone! 👋
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Feel free to ask any questions. I'm here to help!
Details:
Contact : +91 7678446896
Email: skytradingmod@gmail.com
WhatsApp: wa.me/7678446896
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.