Chittorgarh.com Logo
Loading...

At-the-money (ATM)

When the price of an Option is equal its strike price, it is called in the ATM.

Zerodha (Trade with the best stock broker)

Invest brokerage-free Equity Delivery and Direct Mutual Funds (truly no brokerage). Pay flat Rs 20 per trade for Intra-day and F&O. Open Instant Account and start trading today.

call option or put-option is at-the-money if the 'strike price is equal to the current market price' of the underlying asset.

Examples: 

Call Options

Option with Strike Price = Rs 115 OTM Call Options
Option with Strike Price = Rs 110 OTM Call Options
Current Market Price = Rs 109 ATM Call Options
Option with Strike Price = Rs 105 ITM Call Options
Option with Strike Price = Rs 100 ITM Call Options

In above table, if the current market price moves to Rs 111, the option with strike price Rs 110 will become in-the-money call option. 

Put Options

Option with Strike Price = Rs 115 ITM Call Options
Option with Strike Price = Rs 110 ITM Call Options
Current Market Price = Rs 109 ATM Call Options
Option with Strike Price = Rs 105 OTM Call Options
Option with Strike Price = Rs 100 OTM Call Options

 

Note:

  • ITM: In-the-money
  • ATM: At-the-money
  • OTM: Out-of-the-money

Answered on

Zerodha (India's Best & No. 1 Broker)

  Special Offer - Free Equity Delivery and Mutual Funds

  • Brokerage-free equity delivery trades.
  • Brokerage-free Direct Mutual Fund.
  • Pay ₹20 per trade for Intraday & F&O.
  • The best trading platform in India.

Open Instant Demat Account Read Reviews


Comments

Add a public comment...