What is Option Premium?
It’s the cost of an option contract.
When you buy an option, you pay the premium upfront.
Example: If you buy a Call Option of Reliance ₹2800 at ₹50 premium — you pay ₹50 × lot size.
Who Receives It?
The option seller (writer) receives the premium income immediately when they sell (write) the option.
It’s the cost of an option contract.
When you buy an option, you pay the premium upfront.
Example: If you buy a Call Option of Reliance ₹2800 at ₹50 premium — you pay ₹50 × lot size.
Who Receives It?
The option seller (writer) receives the premium income immediately when they sell (write) the option.
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