How Much Should You Price an Option?

The intrinsic value of the option is how far am I in the money? Okay. The time value is basically time and multiply by the variance, right? Because because the greater the variance, the more valuable the options would be. So that tells you how much or in plain English, it tell you how much the asset needs to move for you to break even. It's pretty ugly. And if you go through the actual proof like the Ito Lima and the partial differential, you would never understand. But at the end of the day, just we can split that into two parts like the intrinsicvalue of the option, which is how farAm I in themoney? okay.