What Is the Relationship between Intrinsic Value and "In the Money" Status? ⎊ Path

What Is the Relationship between Intrinsic Value and “In the Money” Status?

An option is "in the money" (ITM) if it possesses intrinsic value. Intrinsic value is the measure of how much profit the option holder would realize if they exercised the option immediately.

If an option is ITM, its intrinsic value is greater than zero. If it is "at the money" or "out of the money," its intrinsic value is zero.

Why Does an Out-of-the-Money Option Only Consist of Time Value?

Does an Out-of-the-Money Option Have Intrinsic Value?

What Is the Term for an Option That Has No Intrinsic Value?

Can an Option Have Extrinsic Value but Zero Intrinsic Value?

Why Is the Option Premium Always Greater than or Equal to Its Intrinsic Value?

What Is the Relationship between an Option’s Delta and Its OTM Status?

What Is the Intrinsic Value of an Out-of-the-Money Put Option?

What Is the Relationship between an Option’s Intrinsic Value and Its ITM Status?

Glossar

Intrinsic Value

Valuation ⎊ This represents the in-the-money amount of an option, calculated as the difference between the spot price and the strike price, if positive, otherwise zero.