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 are 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 atthemoney option has no intrinsic value, but it 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.Differences Between Types of 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. The intrinsic value for a call option is calculated by subtracting the strike price from the underlying security's current price. The intrinsic value for a put option is calculated by subtracting the underlying asset's current price from its strike price.
A call option is said to be in the money when the option's strike price is less than the underlying security's current price. Conversely, a put option is said to be in the money when the option's strike price is greater than the underlying security's stock price. A call option is said to be out of the money when its strike price is greater than the current underlying security's price. On the other hand, a put option is said to be out of the money when its strike price is less than the underlying asset's current price.
The term "near the money" is sometimes used to describe an option that is within 50 cents of being at the money. For example, assume an investor purchases a call option with a strike price of $50.50 and the underlying stock price is trading at $50. The call option is said to be near the money. The option would also be near the money if the underlying stock price was trading between $50.51 and $51.
Option Pricing
An option's price is made up of intrinsic and extrinsic value, or time value. Similar to outofthemoney options, atthemoney options only have time value because they possess no intrinsic value. For example, assume an investor purchases an atthemoney call option with a strike price of $25 for a price of 50 cents. The time value is equivalent to 50 cents and is largely affected by the passage of time and changes in implied volatility.

In The Money (ITM)
In the money means an option has intrinsic value, which is determined ... 
Out Of The Money (OTM)
An out of the money option has no intrinsic value, but only possesses ... 
Intrinsic Value
Intrinsic value is the perceived or calculated value of a company, ... 
Deep Out Of The Money
An option is deep out of the money if its strike price is significantly ... 
Put Option
A put options gives the owner the right to sell a specified amount ... 
Option
Options are financial derivatives that give the option buyer ...

Trading
Understanding Option Pricing
This article will explore what factors you need to consider in the pricing of options when trying to take advantage of a stock price's movement. 
Trading
A Newbie's Guide to Reading an Options Chain
Learning to understand the language of options chains will help you become a more effective options trader. 
Trading
The Basics Of Option Price
Learn how options are priced, what causes changes in the price, and pitfalls to avoid when trading options. 
Trading
The Options Premium
An options premium is the amount of money that investors pay for a call or put option. The two components that affect options pricing are the intrinsic value and time value. Matthew is interested ... 
Investing
Why Options Trading Is Not for the Faint of Heart
Trading options is not easy and should only be done under the guidance of a professional. 
Trading
Options Strategies for Your Portfolio to Make Money Regularly
Discover the optionwriting strategies that can deliver consistent income, including the use of put options instead of limit orders, and maximizing premiums. 
Trading
Option trading strategies: A guide for beginners
Options offer alternative strategies for investors to profit from trading underlying securities. Learn about the four basic option strategies for beginners. 
Trading
Options Hazards That Can Bruise Your Portfolio
Learn the top three risks and how they can affect you on either side of an options trade. 
Trading
Stock Options: What's Price Got To Do With It?
A thorough understanding of risk is essential in options trading. So is knowing the factors that affect option price.

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 >> 
How Do Speculators Profit From Options?
Options are a risky game, but you can learn speculators' tricks to use them to your advantage. Read Answer >>