Options Price Movement

Options price is dependent on underlying or buy/sell orders? Irrespective of available buy/sell orders in options, will the options price increase/decrease automatically if underlying increases/decreases?

Most of option movement is by algos, rather than manual traders.

So you can expect option to efficiently price in the move which happened in underlying

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Options Prices are derived from Black Scholes Formula.

The Black Scholes model requires five input variables: the strike price of an option, the current stock price, the time to expiration, the risk-free rate, and the volatility.

Based on the above variable prices are determined.

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