BizTerm Definition
Out of the money
Full Definition

An option contract is out-of-the-money when there is no benefit to be derived from exercising the option immediately. A call option is out of the money when the price of the underlying is below the option's exercise price. A put option is out of the money when the price of the underlying is above the option's exercise price. See also in-the-money, at-the-money and volatility skew.


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