n NISM Certifications
NSM General NISM
Medium

Option time value is ________ proportional to time until expiration.

Practice question from NISM Series IV - Mock Test 3 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Inversely

  2. Directly (Correct)

    Correct answer

  3. C

    Directly for Put option only

  4. D

    Directly for Call option only

Why this is the answer

Time value decreases as expiration approaches; longer time until expiry means higher time value.

Test yourself for real

Take a full General NISM mock test.

Same duration, same weighting, same difficulty distribution as the real exam — with explanations on every question.