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Premium for
the Futures and Option
As far as the premium is concerned -- there is a main difference between
the futures and the option and they may be treated as two seperate cases:
A Premium:
For futures:
the gap between the cash price of the underlying commodity or index and the futures price.
(see futures
contract )
For options:
the per share amount the buyer pays to the seller as determined
by the market. (combining the intrinsic value and the time value
premium - see also intrinsic value and options
contract )
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