In, at, and out of the money
Where the stock is relative to the strike.
4 min · Intermediate · Lesson 6 of 17
Step 1 of 4
The three states
- In the money (ITM): the option has intrinsic value. A call with the stock above the strike; a put with the stock below.
- At the money (ATM): the stock is at or very near the strike.
- Out of the money (OTM): no intrinsic value. A call with the stock below the strike; a put with the stock above.
For entertainment and education, not investment advice.