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General TradingT
Time Value
The portion of an option's premium that exceeds its intrinsic value, reflecting the probability that the option will gain additional value before expiration. Time value decreases as expiration approaches, a phenomenon known as time decay.
Example
“A call option on ETH with 30 days to expiration had $200 of intrinsic value and $80 of time value, for a total premium of $280.”