Premium: It is the amount the buyer needs to pay to have the right to exercise options. The premium is the sum of the intrinsic value and time value. Strike price: The strike price, also known as the exercise price, is the predefined price at which the trader can buy or sell underlying assets when exercising options. Lot size: Refers to the total number of contracts in one derivative. Expiration date: The last date on which the option contract for that particular series expires. The series can be weekly or monthly.