Stock Option Trading & Investing Blog


Moneyness

At The Money- ATM options have a strike price that is the same as the current trading price.  An ATM option has no intrinsic value but does have time value.

In The Money- ITM options have positive intrinsic value and positive time value.  A call option is said to be in the money when the strike price is below the current trading price.  A put option is in the money when the current price is higher than the strike price.

Out Of The Money- OTM options have no intrinsic value.  For a call option this means the strike price is above the current trading price.  A put option is OTM when the strike price is below the current trading price.

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