Editing Moneyness (section)

===At the money===
An [[option (finance)|option]] is '''at the money''' (ATM) if the [[strike price]] is the same as the current spot price of the underlying security. An at-the-money option has no intrinsic value, only time value.<ref name="at-the-money">[http://atthemoney.com/what-is-at-the-money/ At the Money Definition] {{webarchive|url=https://web.archive.org/web/20120616065227/http://atthemoney.com/what-is-at-the-money/ |date=2012-06-16 }}, Cash Bauer 2012</ref>

For example, with an "at the money" call stock option, the current share price and strike price are the same. Exercising the option will not earn the seller a profit, but any move upward in stock price will give the option value.

Since an option will rarely be exactly at the money, except for when it is written (when one may buy or sell an ATM option), one may speak informally of an option being '''near the money''' or '''close to the money'''.<ref name="iopntm">"[http://www.investopedia.com/terms/n/near-the-money.asp Near The Money]", Investopedia</ref> Similarly, given standardized options (at a fixed set of strikes, say every $1), one can speak of which one is '''nearest the money'''; "near the money" may narrowly refer specifically to the nearest the money strike. Conversely, one may speak informally of an option being '''far from the money'''.