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Intrinsic Value

June 8, 2018 -

The profit that would result if an option were immediately exercised. It is also the amount that an option is in-the-money. For call options, the intrinsic value is equal to zero or (spot – strike), whichever is greater. For put options, the intrinsic value is equal to zero or (strike – spot), whichever is greater….

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In-the-Money

June 8, 2018 -

Term referring to an option that has intrinsic value. Call options are in-the-money if the spot price is greater than the strike price; put options are in-the-money if the spot price is less than the strike price. See also At-the-Money Intrinsic Value Near-the-Money Out-of-the-Money Time Value

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Implied Volatility

June 8, 2018 -

The level of market volatility that makes an option’s theoretical value equal to its current market price. See also Volatility.

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