intrinsic value of option
Intrinsic value of the option basically calculates how valuable the option is to the option holder. This value is calculated by figuring out the difference between the exercise price of the option and the spot price of the asset that is being held, which should tell the holder how much value he has been holding over that option in case it is exercised.
- Part of Speech: noun
- Industry/Domain: Financial services
- Category: Finance
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