Option Theoretical Value
From Open Risk Manual
Definition
Option Theoretical Value. Theoretical value looks at variability of the price. The longer until exercise the more this will vary. the more likely it is to finish in the money, the more I am likely to pay for it. But meanwhile, I also have to look at the current value - the amount I would pay for the thing. Any change would be a cost to me.
Fair Value is the amount I would spend in maintaining a neutral hedge.
Disclaimer
This entry annotates a FIBO Ontology Class. FIBO is a trademark and the FIBO Ontology is copyright of the EDM Council, released under the MIT Open Source License. There is no guarantee that the content of this page will remain aligned with, or correctly interprets, the concepts covered by the FIBO ontology.
Facts about "Option Theoretical Value"
| IsDefinedBy URI of an entity that is defined via an imported vocabulary. | https://spec.edmcouncil.org/fibo/ontology/MD/DerivativesTemporal/ETOptionsTemporal/index-en.html + |
