At The Money

What is 'At The Money'

At the money is a situation where an option's strike price is identical to the price of the underlying security. Both call and put options will be simultaneously "at the money." For example, if XYZ stock is trading at 75, then the XYZ 75 call option is at the money and so is the XYZ 75 put option. An at-the-money option has no intrinsic value, but may still have time value. Options trading activity tends to be high when options are at the money.

BREAKING DOWN 'At The Money'

"At the money" is one of three terms used to describe the relationship between an option's strike price and the underlying security's price, or option "moneyness." The other two are "in the money," meaning the option has some intrinsic value, and "out of the money," meaning the option has no intrinsic value. Also, sometimes the term "near the money" is used to describe an option that is within 50 cents of being at the money.

RELATED TERMS
  1. In The Money

    1. For a call option, when the option's strike price is below ...
  2. Out Of The Money - OTM

    A call option with a strike price that is higher than the market ...
  3. Deep Out Of The Money

    An option with a strike price that is significantly above (for ...
  4. Time Value

    The portion of an option's premium that is attributable to the ...
  5. Deep In The Money

    An option with an exercise price, or strike price, significantly ...
  6. Bear Call Spread

    A type of options strategy used when a decline in the price of ...
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RELATED FAQS
  1. When is a call option considered to be "in the money"?

    Learn about call options, their intrinsic values and why a call option is in the money when the underlying stock price is ... Read Answer >>
  2. How does the term 'in the money' describe the moneyness of an option?

    Find out what in the money means about the moneyness of call or put options and what it indicates about the relationship ... Read Answer >>
  3. What is the difference between a long position and a call option?

    Learn what a long position in a stock is, what a call option is, and the difference between owning shares of a company and ... Read Answer >>
  4. When is a put option considered to be "in the money"?

    Learn about put options, what they are, how these financial derivatives operate and when put options are considered to be ... Read Answer >>
  5. How do speculators profit from options?

    As a quick summary, options are financial derivatives that give their holders the right to buy or sell a specific asset by ... Read Answer >>
  6. Why are options very active when they are at the money?

    Stock options, whether they are put or call options, can become very active when they are at the money. In the money options ... Read Answer >>
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