time value

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Related to time value: Time value of money

Time value

Applies to derivative products. Portion of an option price that is in excess of the intrinsic value, due to the amount of volatility in the stock; sometime referred to as premium. Time value is positively related to the length of time remaining until expiration.

Time Value

1. See: Option time value.

2. See: Time value of money.

3. See: Extrinsic value.

time value

The portion of an option premium in excess of the option's intrinsic value. A call option that allows the holder to buy 100 shares of a $25 stock for $20 (the strike price) has an intrinsic value of $500. The time value is $150 if the option trades for $650.
References in periodicals archive ?
There are different scenarios in which time value may reach 20% of total value.
Time value can't actually be taxed--because it disappears at exercise--but it represents the potential additional intrinsic value of the option, so that if the shares eventually rose, that appreciation would become intrinsic value and eventually be taxed at the option's exercise (See Exhibit 1).
One of the potential problems in the estimation of opportunity time value is the assumption that it is constant with respect to travel time per trip.
Time value is the sum of money buyers are willing to pay for an option over and above any intrinsic value the option may presently have.
As stated at the beginning of this column, it is sometimes necessary to consider the time value of money when making investment decisions.
An entirely new section entitled "Time Value of Money" examines in detail the federal tax treatment of interest in various important situations, covering key topics such as original issue discount, imputation of interest in sales and exchanges of property under Sections 483 and 1274, below-market loans under Section 7872, and miscellaneous time value of money rules.
Unfortunately, I have never met a politician who is actually motivated by the time value of money
For example, only properties acquired after 1986 are eligible under the IRS ruling, and owners who plan on disposing of their properties in the short-term will not benefit, as the savings are based solely on the time value of money and the benefit could be re-captured upon sale.