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Define the Term “Out-of-the-Money” (OTM) for a Call Option

The strike price is higher than the current spot price; the option has no intrinsic value.
Greeks.Live28.10.25

Define the Term “Out-of-the-Money” (OTM) for a Call Option.

A Call option is out-of-the-money (OTM) if the strike price is higher than the current spot price of the underlying asset. OTM options have no intrinsic value, only extrinsic (time) value, and the buyer is hoping the spot price will rise above the strike before expiration.

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