Part 9 Trading Master Class

Moneyness of Options

Options are categorized based on their relationship to the current market price:

In-the-Money (ITM) – Option has intrinsic value

At-the-Money (ATM) – Strike price is near the market price

Out-of-the-Money (OTM) – Option has no intrinsic value

ATM options are most sensitive to price movement, while OTM options are cheaper but require larger moves to become profitable.