September 9, 2019

What Is Option Premium and How Do We Value It?

The premium of an option is often used interchangeably with price.  While that is almost true, it’s not entirely true.  The price of an option includes both intrinsic and extrinsic value.  The premium of an option refers to just the extrinsic value.

Watch the video below as we analyze the premium associated with our position in NXPI.

Follow me on Twitter @CboeSIB

about the author:

Scott Bauer

A respected market commentator seen on Bloomberg, Fox Business, CNBC and other major financial networks, Scott Bauer has 30+ years of professional equity and index options experience at the Chicago Board Options Exchange (CBOE) and Chicago Mercantile Exchange (CME) and as a Vice-President/trader for Goldman Sachs. Scott graduated with Honors from the University of Illinois Business School and has taught classes both at his alma mater and at the CBOE.

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April 6, 2026

Q1 Earnings Season Preview: What To Expect

As we start a brand new quarter in 2026, it also resets the earnings cycle for companies to report their quarterly results — and I believe that Q1 Earnings Season could have a lot in store. Q4 earnings season at the start of the year gave traders a lot to process. It also set the […]

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April 3, 2026

March 2026 Jobs Report: The Good, Bad, & Unexpected

The March 2026 Jobs Report was among the most anticipated ones in recent memory. Right now, the economy is being shaped by a number of factors: These current circumstances — combined with February’s bad jobs report — had traders preparing for the worst. Fortunately, the March 2026 Jobs Report looked much better than expected…at least […]

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February 15, 2026

Why Option Premiums Rise Before Binary Events

Ever wonder why option premiums rise before binary events in the stock market? It’s not uncommon for option prices to spike ahead of major announcements like: For context, I like to describe option premium as the difference between the contract’s price and intrinsic value. It’s essentially what buyers pay for the “hope” that an option […]

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April 20, 2026

Pattern Day Trader Rule Eliminated: What It Means for Retail Traders

For more than two decades, a single regulation kept millions of everyday investors on the sidelines of day trading.  On April 14, 2026, that changed.  The SEC approved FINRA’s proposal to eliminate the Pattern Day Trader (PDT) rule, scrapping the $25,000 minimum account balance requirement that had defined the boundaries of retail day trading since […]

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April 19, 2026

Weekly Earnings Prep: 2 Things To Know For Earnings This Week

With earnings season starting to heat up, our team at Prosper Trading Academy will be taking a deeper dive into some of the stocks they’re watching. Over the next few Sundays, you’ll be hearing from 2-3 of the Prosper coaches, who will share one stock — with earnings coming up that week — that’s on […]

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https://www.prospertrading.com/mike-shorrs-favorite-satellite-stock/Mike Shorr’s Favorite Satellite Stock
April 17, 2026

Mike Shorr’s Favorite Satellite Stock

Satellite stocks are turning heads in the market after Amazon announced their purchase of Globalstar Inc. (GSAT). Mike Shorr is a big fan of the sector, and has been watching one satellite stock — AST SpaceMobile Inc. (ASTS) — even before the Amazon announcement. Mike appeared on Business First AM recently to discuss why he’s […]

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