← Options Glossary

Overvalued

Describing a security trading at a higher price than it logically should. Normally associated with the results of option price predictions by mathematical models. If an option is trading in the market for a higher price than the model indicates, the option is said to be overvalued. See also Fair Value and Undervalued.

This is a definition, not a recommendation. Options carry risk and can expire worthless. See how the desk actually trades at TrueTrader.