Moneyness
Moneyness is a term describing the relationship between the strike price of an option and the current trading price of its underlying security. Where settlement is financial, the difference between the strike price and the spot price will determine the value, or "moneyness", of the contract.
In options trading, terms such as in-the-money, at-the-money and out-of-the-money describe the moneyness of options.
A call option is in-the-money if the strike price is below the market price of the underlying stock. A put option is in-the-money if the strike price is above the market price of the underlying stock.
A call or put option is at-the-money if the stock price and the exercise price are the same (or close).
A call option is out-of-the-money if the strike price is above the market price of the underlying stock. A put option is out-of-the-money if the strike price is below the market price of the underlying stock.
Read more about this topic: Strike Price