Derivatives

In-the-money

An option is considered In-the-money when the buyer is in a profitable position at a specific spot price of the underlying securities. This term is used in reference to both call and put options, with slightly different criteria for each. In the case of a call option, it is deemed In-the-money when the spot price exceeds the strike price. Conversely, for a put option, it is In-the-money when the spot price falls below the strike price. This concept is important to understand when delving into the world of finance and options trading.

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