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Time Decay

Option value loss from time passing

What is Time Decay?

Time Decay The reduction in option value as time passes. Accelerates as expiration approaches. Options lose about 1/3 of their value in the last 30 days, and 2/3 in the last week.

Complete Definition

The reduction in option value as time passes. Accelerates as expiration approaches. Options lose about 1/3 of their value in the last 30 days, and 2/3 in the last week.

Related Terms

Theta Extrinsic Value

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