Common use of In-the-Money Options Clause in Contracts

In-the-Money Options. A call is in the money when the underlying stock price is greater than the call’s strike price. An XYZ June 40 call is $2 in the money when XYZ is at $42 per share. A put is in the money when the underlying stock price is lower than the put’s strike price. An ABC October 70 put is $4 in the money when ABC is at $66 per share. It would only make sense to exercise an option if it was in the money. Both puts and calls are at the money when the underlying stock price equals the options exercise price.

In-the-Money Options. A call is in the money when the underlying stock price is greater than the call’s strike price. An XYZ June 40 call Call is $2 in the money when XYZ is at $42 per share. A put is in the money when the underlying stock price is lower than the put’s strike price. An ABC October 70 put Put is $4 in the money when ABC is at $66 per share. It would only make sense to exercise an option if it was in the money. Both puts and calls are at the money when the underlying stock price equals the options exercise price.

In-the-Money Options. A call is in the money when the underlying stock price is greater than the call’s strike price. An XYZ June 40 call is $2 in the money when XYZ is at $42 per share. A put is in the money when the underlying stock price is lower than the put’s strike price. An ABC October 70 put is $4 in the money when ABC is at $66 per share. It would only make sense to exercise an option if it was in the money. Both puts and calls are at the money when the underlying stock price equals the options option’s exercise price.