Stock-exchange glossary

The extrinsic value of an option is the prevailing price minus its intrinsic value (value that the holder could receive immediately if the option was exercised). The extrinsic value decreases as the warrant¿s remaining time to maturity diminishes. At the end of this time the extrinsic value = 0. Towards the end of the maturity period the decline in the extrinsic value increases disproportionately.