In options trading, the extrinsic value of an option represents the portion of the option's price that's based on factors other than the immediate value of exercising it. Also known as “time value,” ...

Option pricing is calculated using the Black-Scholes model, which takes four influential factors into account: the price of an underlying stock (assuming constant drift and volatility), an option’s ...

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This article was written by David Mullen, Product Manager for Core Fixed-Income Analytics, and Fateen Sharaby, Business Manager for Index-Linked Products at Bloomberg. Credit futures, which started ...