™Paying $3 per share for one standard 100-share option costs $300 before fees; confirm that the quoted premium and deliverable use the expected units.
Options
Premium
The market price paid by an option buyer and received by an option seller.
Plain-English context
Put the definition to work.
Check per-share versus per-contract units. The premium received by a writer is not its maximum possible loss.
Further reading and verification. Examples are hypothetical, not current quotes or recommendations. Product terms, tax treatment and market rules can change. OCC / Options Industry Council — options basics