Options

Out-of-the-Money (OTM)

Definition

An option with no intrinsic value. A call is OTM when underlying is below strike; a put when above.

Example
SPX at 6200 makes a 6300 call OTM. Intrinsic Value Category: Options Definition: The immediate exercise value of an option. For a call: max(underlying price – strike, 0). For a put: max(strike – underl
Frequently Asked Question
What is Out-of-the-Money (OTM) in trading?
An option with no intrinsic value. A call is OTM when underlying is below strike; a put when above.
APA Citation
Clark, R. (2025). Out-of-the-Money (OTM). VixShield Trading Glossary. Retrieved from https://www.vixshield.com/glossary/out-of-the-money-otm
RC
Russell Clark, FNP-C
Author of SPX Mastery series · Founder of VixShield
Last updated:  ·  Source: VixShield Trading Glossary — From SPX Mastery by Russell Clark
⚠️ Not financial advice. This definition is educational content from the SPX Mastery book series by Russell Clark (VixShield). Past performance is not indicative of future results. Trading options involves substantial risk of loss and is not appropriate for all investors. Always paper trade before risking real capital.