I'm not clear for the terminology of options and the mechanics of it. Any help is appreciated. For example the following statement:
European call option of Apple stock with maturity 1 year and strike price $15. The option is trading at 13 dollars.
- Is it correct to say that the premium is $13 for this call option?
- When is the premium paid, when the buyer buys the option or at maturity?
- Can the holder of the option exercise it whenever he wants or should wait for the maturity?
Thanks in advance