Glossary › premium

Trading glossary · advanced

premium

The price you pay for a buy-or-sell ticket. It can also mean paying extra above today's price.

The fuller meaning

The price of an option, paid by the buyer to the seller: intrinsic value plus time value, quoted per unit and multiplied by the contract size. More generally, a price above a reference, as when a futures contract trades at a premium to spot and loses that premium as it converges.

premium.

Related words

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