Time value: Difference between revisions
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imported>Doug Williamson (Expand stub. Source: ACT qualifications material.) |
imported>Doug Williamson (Layout.) |
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The component of an option’s total value which is related to the length of the unexpired maturity of the option, and which is additional to the Intrinsic value, if any. Time value represents the incremental profit that would be enjoyed if the option was sold, rather than being exercised or allowed to lapse. | |||
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Time value of money. | |||
Revision as of 14:30, 13 May 2016
1.
The component of an option’s total value which is related to the length of the unexpired maturity of the option, and which is additional to the Intrinsic value, if any. Time value represents the incremental profit that would be enjoyed if the option was sold, rather than being exercised or allowed to lapse.
2.
Time value of money.
