Glossary › intrinsic value

Trading glossary · advanced

intrinsic value

How much a buy-or-sell ticket would be worth if you used it right now.

The fuller meaning

For an option, the amount it is in the money: price minus strike for a call, strike minus price for a put, and zero otherwise. An option's premium is intrinsic value plus time value, and at expiry it is worth only its intrinsic value.

intrinsic value.

Related words

at the money · backtest · backwardation · basis · call option · contango · data snooping · delta · edge · entry trigger