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Definitions
Strike Price
Strike price is the level of price/value of the underlying at which the option will start bringing positive cashflow on exercise.
In the case of binary options, when the underlying price reaches the strike level, the option can be exercised and pays out collateral to holder.
In a put option the strike price is reached from the top and in a call option the strike price is reached from below.
Underlying
Underlying is an instrument/parameter from which an option derives its value. Strike price is expressed in the terms of the underlying value/level.
Expiration Date
Premium
Premium is the price paid by a buyer of an option to the writer of an option in exchange for the protection/optionality that the option gives.
When the option contract is traded on AMM, premium is the current price at which it trades.
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