At-the-money

Also found in: Acronyms.

At-the-money

An option is at the money if the strike price of the option is equal to the market price of the underlying security. For example, if xyz stock is trading at 54, then the xyz 54 option is at the money.

At the Money

An option contract with a strike price exactly equal to the price of the underlying asset. In this situation, the option contract has no intrinsic value. However, it can easily develop an intrinsic value if the option becomes in-the-money. At-the-money options are extremely volatile because they can become in-the-money or out-of-the-money quickly.

at-the-money

Of or relating to a call or a put option that has a strike price equal to the price of the underlying asset.

At-the-money.

At-the-money is another way of saying at the current price. Options whose exercise price is the same or almost the same as the current market price of the underlying stock or futures contract are considered at-the-money.

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References in periodicals archive ?

Our result of setting the strike price of options at the maximum level compatible with the effort constraint is not directly comparable with that--advocated for instance by Hall and Murphy (2000)--of issuing at-the-money options, as we do not explicitly consider the value of the underlying assets at grant date.

Managers' compensation and misreporting: a costly state verification approach

All implied volatility indices are constructed for (hypothetical) at-the-money index options with a constant time to maturity.

The New Zealand implied volatility index

Until the mid-1990s, companies only had to book as compensation expense those stock option grants that had positive intrinsic value--hence the popularity of at-the-money (as opposed to in-the-money) option grants.

Regulatory rules and estimating economic growth: two perspectives on expensing employee stock options (1)

option intended to be at-the-money should have an exercise price of

Options as disguised financings: the demise of an urban tax legend

We propose to compute the risk minimization hedging using standard options by jointly modeling the underlying price dynamics and the Black-Scholes at-the-money implied volatility explicitly.

Robustly hedging variable annuities with guarantees under jump and volatility risks

That is, if the BS model assumptions were literally true, the IV from a deep-in-the-money call should be the same as that from an at-the-money call or an in-the-money put.

Using implied volatility to measure uncertainty about interest rates

For example, we know of a retailer that emerged from bankruptcy and gave a new CEO 1,000,000 at-the-money options at a low stock price ($10).

Executive equity compensation and incentives: a survey. (Part 1: a review of the literature on corporate governance)

Lassek explained terms such as margin call, at-the-money option and strike price during the seminar.

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However, the degree of nonlinearity tends to be small for at-the-money options.

The Risks and Rewards of Selling Volatility

Louis' monthly Monetary Trends, said, "Using the trading prices of options on the S&P 100, the CBOE estimates the implied volatility corresponding to a hypothetical at-the-money option with one month to expiration.

Market Volatility

In the OTC market for currency options, financial institutions quote prices for three products in particular: at-the-money options and two types of option combinations known as risk-reversals and strangles.

CAN THE PRICE OF CURRENCY OPTIONS PROVIDE AN INDICATION OF MARKET PERCEPTIONS OF THE UNCERTAINTY ATTACHED TO THE KRONE EXCHANGE RATE?

However, most of these companies have at-the-money option programs with constant exercise prices.