What Is 'In-the-Money' and How Does It Relate to Exercising an Option? ⎊ Path

What Is ‘In-the-Money’ and How Does It Relate to Exercising an Option?

An option is 'in-the-money' (ITM) when exercising it immediately would result in a profit. For a call option, this means the underlying price is above the strike price.

For a put option, the underlying price is below the strike price. ITM options have intrinsic value and are the only ones that would rationally be exercised.

What Is the ‘Intrinsic Value’ of an Option?

Why Is Exercising an American Call Option Early to Capture a Large In-the-Money Value Still Usually a Poor Decision?

What Does It Mean for an Option to Be ‘Out-of-the-Money’?

What Does It Mean for an Option to Be “In-the-Money”?

How Does the Moneyness of an Option (ITM, ATM, OTM) Relate to the Strike Price?

Define the Terms “In-the-Money,” “At-the-Money,” and “Out-of-the-Money” for a Call Option

Define ‘In-the-Money’ (ITM) for Both Call and Put Options

What Is ‘Intrinsic Value’ in an Options Contract?