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In the money (ITM)

An option with intrinsic value: a call with the stock above its strike, or a put with the stock below it.

How a call option's delta changes with the underlying priceAn S-shaped curve rising from zero, passing through about a half at the strike, and flattening near one.Delta of a call option1.000.5008090110120Out of the moneyAt the moneyIn the money1.00 means it moves one-for-one with the stockdelta ≈ 0.50 at the strikeStrike 100Underlying price
Delta across the range of prices. Delta says how much a call's price moves for a one-point move in the stock. Far below the strike it is near 0 and the option barely reacts; at the strike it is about 0.50; far above it approaches 1 and tracks the stock.

ITM options move more like the stock (higher delta) and cost more because they carry intrinsic-value. Deep ITM options have very little extrinsic-value and behave almost like a leveraged stock position.

ITM options at expiration are automatically exercised by most brokers, which can leave you with a stock position you did not intend. See assignment.

Example: stock at $88. The $80 call and the $95 put are both in the money; the $80 call by $8 and the $95 put by $7.

Related: out-of-the-money, at-the-money, intrinsic-value, delta

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