What happens to the value of an in-the-money option as it approaches expiration?

As an option approaches expiration, its time value generally erodes due to the diminishing amount of time remaining for the underlying asset to move in favor of the option holder. This is particularly true for in-the-money options, which have intrinsic value. However, the total value of the option consists of both intrinsic value and time value. While the intrinsic value may remain stable or even increase as the underlying asset's price changes, the time value decreases as expiration nears, reflecting the reduced probability of further price movement. This phenomenon is known as time decay, and it accelerates as expiration approaches, specifically for options in the money. Understanding this concept is crucial for options traders, as it influences the timing of trades and the valuation of options in their portfolios.