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Definition of Time value - Finance dictionary
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Time value (See Chapter 24 of the Vernimmen)
The time value of an option is an anticipation of an increase in intrinsic value. Time value diminishes with the passage of time, as the closer the option gets to the exercise date, the less likely it is that the price of the Underlying asset will exceed or fall below the Strike price for a Call option and Put option respectively.
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Definitions of terms begining
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Time value (See Chapter 24 of the Vernimmen)
The time value of an option is an anticipation of an increase in intrinsic value. Time value diminishes with the passage of time, as the closer the option gets to the exercise date, the less likely it is that the price of the Underlying asset will exceed or fall below the Strike price for a Call option and Put option respectively.
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