A
In the Money
In the Money
Image 1 For a call option it is when an option's strike price is below the market price of the underlying stock.

For a put it is when the strike price is above the market price of the underlying stock.
Image 2 In other words when your stock option is worth money, you can turn around and sell it (or exercise it) for a profit.


Call Option

Option

Out of the Money

Put Option

Strike Price