Intrinsic value: Difference between revisions
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imported>Doug Williamson m (Link with In the money page.) |
imported>Doug Williamson (Link with Option page.) |
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== See also == | == See also == | ||
* [[Market value]] | * [[Market value]] | ||
* [[Option]] | |||
* [[Present value]] | * [[Present value]] | ||
* [[Time value]] | * [[Time value]] | ||
* [[In the money]] | * [[In the money]] | ||
Revision as of 10:47, 7 October 2015
1.
The component of a the value of an option which relates to the gain - if any - which could be earned by immediate exercise of the option.
For a call option this is the excess - if any - of the underlying asset price over the strike price.
For a put option it is the excess - if any - of the strike price over the underlying asset price.
2.
The value of any financial asset determined by reference to the present value of its expected net future cash flows.
3.
More generally, the value of any asset determined by reference to its particular fundamental characteristics, rather than by reference to current market prices.
