Discover and read the best of Twitter Threads about #OTM

Most recents (1)

Profile picture
Tanmay Kurtkoti Quants Capital
@Quants_Capital
#ITM Vs #OTM #Options Which to #BUY?

When selecting the right #option to #buy, a #trader has several choices to make. One is whether to purchase an in-the-money (ITM) or out-of-the-money (OTM) option.
While the goal for "#vanilla" #buyers is to have the option be in the money at expiration, the selected option depends on the amount the trader wants to spend and their risk tolerance, as well as their specific expectations for the underlying stock.
UNDERSTANDING #ITM Vs #OTM

Before delving into the pros and cons of each, let's look at what it means to be itm or otm.
A #call is ITM when the underlying stock is trading above the strike price.
Conversely it is OTM when the underlying stock is trading below the strike price
Read 16 tweets

Related hashtags

#wrong #underlying #optiongreeks #quantscapital #OPTION #put #vanilla #intrinsic #OTM #buyers #timevalue #expiration #risks #weekendgyan #stock #options #deltas #contracts #lower #ITM #time #call #trading #decay

Did Thread Reader help you today?

Support us! We are indie developers!

This site is made by just two indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member ($3.00/month or $30.00/year) and get exclusive features!

Become Premium

Too expensive? Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal Become our Patreon

Thank you for your support!