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Option Pricing

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Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

The price of an option is made up of intrinsic and extrinsic value.

Intrinsic value represents the difference between the stock price and the strike price

Extrinsic value is the time premium portion of the option.

In today's segment, Tom and Tony dive into what makes up an option price, and how we can use pricing to help us decide when to place a trade.

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