Derivatives
Average Price of Option
May 26, 2020
Derivatives
Aggregation
May 26, 2020

An estimated price of an option based on the premise that the relationships between the underlying price and the option price (premium) observed in a previous time horizon still hold and have an explanatory power. The so-called normal price is usually a prediction of what an option price would be, made using econometric models or techniques. And hence it is not unusual that this price will deviate from fair value.

The average price of option is also known as an average price of option.

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