ITM (in-the-money)
ITM
An option that has positive intrinsic value — call strike below spot, or put strike above spot.
ITM options behave more like the underlying (high delta near 1.0); their premium is dominated by intrinsic value. Frequently used as leveraged spot proxies.
Related terms
- ATM (at-the-money)An option whose strike is approximately equal to the current underlying price — pure time value, no intrinsic.
- OTM (out-of-the-money)An option with no intrinsic value — call strike above spot, or put strike below spot.
- OptionA derivative giving the holder the right (not obligation) to buy ([[call-option]]) or sell ([[put-option]]) at a fixed price by expiry.