Skip links


In the context of financial markets, a premium refers to the additional cost or price paid for a particular asset or instrument, over and above its intrinsic value. It is typically used in the context of options trading, where the premium is the price paid for an options contract, and represents the cost of buying the right to buy or sell an underlying asset at a predetermined price (strike price) at a future date. The premium is determined by a number of factors, including the current price of the underlying asset, the strike price, the time to expiration, and the implied volatility of the asset. Generally, the higher the perceived risk or uncertainty associated with the underlying asset, the higher the premium will be.

Warning: Invalid argument supplied for foreach() in /home/customer/www/ on line 174