edamo, we have no disagreement on implied volatility or the factors that affect option prices. From a link sent me by disu [Thanks!]:
phlx.com
" Together, these factors are termed time value. The primary components of time value are time remaining until expiration, volatility, dividends, and interest rates. Time value is the amount by which the option premium exceeds the intrinsic value.
Option Premium = Intrinsic Value + Time Value
For in-the-money options, the time value is the excess portion over intrinsic value. For at-the-money and out-of-the-money options, the time value is the option premium. [italics added] "
We appear to be arguing about the meaning of words like component, factor, influence, contains, and "is"... <g>
Truce?
BP |
