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    Moneyness: Deep ITM Deep ITM ITM ITM ATM ATM OTM OTM Deep OTM Deep OTM

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    saurabhsaraf
    The document discusses moneyness and how the intrinsic value, time value, and liquidity of options vary based on whether the strike price is at-the-money (ATM), in-the-money (ITM), or out-of-the-money (OTM). Deep ITM or OTM options have low liquidity and sellers may offer low prices, while ATM options have the highest time value and are most liquid.

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    Moneyness: Deep ITM Deep ITM ITM ITM ATM ATM OTM OTM Deep OTM Deep OTM

    Uploaded by

    saurabhsaraf
    15 views1 page
    The document discusses moneyness and how the intrinsic value, time value, and liquidity of options vary based on whether the strike price is at-the-money (ATM), in-the-money (ITM), or out-of-the-money (OTM). Deep ITM or OTM options have low liquidity and sellers may offer low prices, while ATM options have the highest time value and are most liquid.

    Original Description:

    OPTION MONEYNESS

    Original Title

    OPTION MONEYNESS

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    The document discusses moneyness and how the intrinsic value, time value, and liquidity of options vary based on whether the strike price is at-the-money (ATM), in-the-money (ITM), or out-of-the-money (OTM). Deep ITM or OTM options have low liquidity and sellers may offer low prices, while ATM options have the highest time value and are most liquid.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pptx, pdf, or txt
    15 views1 page

    Moneyness: Deep ITM Deep ITM ITM ITM ATM ATM OTM OTM Deep OTM Deep OTM

    Uploaded by

    saurabhsaraf
    The document discusses moneyness and how the intrinsic value, time value, and liquidity of options vary based on whether the strike price is at-the-money (ATM), in-the-money (ITM), or out-of-the-money (OTM). Deep ITM or OTM options have low liquidity and sellers may offer low prices, while ATM options have the highest time value and are most liquid.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pptx, pdf, or txt
    of 1

    Moneyness

    Deep far ITM or OTM are illiquid , you may not find buyers or he will ask low
    Price. Study IV of ATM call and put is higher commoner are bullish but we
    Are bearish . Highest time value at ATM

    Intrinsic Premium call Strike Put Premium Intrinsic Time


    Time Value Spot/Future Value Value
    Value Price
    Deep Deep
    ITM ITM
    ITM ITM

    ATM ATM

    OTM OTM

    Deep Deep
    OTM OTM

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