premium

The extra amount you pay for a security over and above its intrinsic value. For example:

Warrants: the premium on a warrant is calculated as the price of the warrant minus the difference between the exercise price and the price of the underlying asset. So if a warrant costing 8p gives you the right to buy a share at 75p, and that share was currently trading at 70p, the premium would be 3p (8-5).

Investment trusts: the premium is the amount by which the share price of the investment trust exceeds its net asset value per share.

e.g. If the Net Asset Value is £3.00, and the share price of the trust is £3.30, the trust is trading at a 10% premium to its NAV.

In the more common situation where the share price is below the net asset value, the trust is said to be trading at a discount.