What Influences an Option's Price?

What Influences an Option's Price?

There are seven factors that influence an option’s price:
1. The type of option (call or put)
 2. The price of the underlying asset
 3. The exercise price (or strike price) of the option
 4. The expiration date
 5. Volatility – Implied and Historical
 6. Risk-free interest rate
 7. Dividends and stock splits

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