Why does premium amount of Call and Put options increases as we keep scaling down to ITM strike prices (matlab jitne niche ka strike price from the current market price utna jyada premium).
Please explain.
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your explanation is only correct for call option as end of expiration-
Value of call option= mkt price of stock- strike price
Value of put option= strike price- mkt price of stock
Hey, my question was why does premium amount of ITM strike price rise as we move deep into ITM for both Call and Put?
What you’ve answered is Intrinsic value if I’m not wrong, please clarify.
Because as deep ITM the stock will be in. The more expected profit company is expecting to earn.