In the Money (ITM): Definition & Example

In the Money (ITM)

Also called: itm

An option that would be worth exercising right now.

A call is in the money when the stock is above the strike; a put is in the money when the stock is below the strike. In-the-money options have real (intrinsic) value. The opposite is out of the money, which has no intrinsic value, only time value.

For example

With a stock at $55, a $50 call is $5 in the money. A $50 put on that same stock is out of the money.

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In the Money (ITM)

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