In the Money (ITM)

Options and Derivatives Financial Terms Dictionary

Contents

A call option is in the money (ITM) if the market price is higher than the strike price.

A put option is in the money if the market price is below the strike price.
An option can also be out of the money (OTM) or in the money (ATM).
Options contracts in the money have higher premiums than other non-ITM options.
Investors should factor in the cost of purchasing options when calculating the potential return on the option in the money.