In the options market, you are' Out of the money' when the market price of a stock is not close to the strike price. In the case of call options-which you buy when you think the price is going up-you're out of the money when the stock price is below the strike price. And in the case of put options-which you buy when you think the price of the underlying investment is going down-you're out of the money when the stock price is higher than the strike price. For example, a call option on a stock with a strike price of $50 would be out of the money if the current market price were $45. And a put option on the same stock would be out of the money if its market price were $55. When an option is out of the money, you don't exercise it but let it expire.
| APA | Barry Goldsmith. (2010). out of the money. Retrieved September 26, 2026, from http://smartdefine.org/out_of_the_money/definitions/1159938 |
| Chicago | Barry Goldsmith. 2010. "out of the money" http://smartdefine.org/out_of_the_money/definitions/1159938 (accessed September 26, 2026). |
| Harvard | Barry Goldsmith 2010, out of the money, Smart Define, viewed 26 September, 2026, <http://smartdefine.org/out_of_the_money/definitions/1159938>. |
| MLA | Barry Goldsmith. "out of the money" 21 October 2010. Web. 26 September 2026. <http://smartdefine.org/out_of_the_money/definitions/1159938> |