In the Money

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In-the-Money

1. A call option with a strike price less than the value of the underlying asset.

2. A put option with a strike price more than the value of the underlying asset.

In both these situations, the option contract has intrinsic value. If an option is deep in the money, it is unlikely that the option will be out-of-the money by the time the option is exercised.

In the Money

What Does In the Money Mean?

The state of a call option when its strike price is below the market price of the underlying asset. For put options, it is the state when the strike price is above the market price of the underlying asset.

Investopedia explains In the Money

In other words, this is when a stock option is worth money and the investor can turn around and sell or exercise it for a profit.

Related Terms:
• Call Option
• Common Stock
• Premium
• Put Option
• Strike Price

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