Explore Your Options by Jay Kaeppel
THE KEYS TO BUYING CALL OPTIONS
Should I buy an in-the-money (ITM), at-the-money (ATM), or out-of-the-money (OTM) call option if I am bullish on a stock?
It’s important to recognize that there is no uniformly “correct” answer to that question. Before proceeding, let’s also note for the record that an ITM call has a strike price that is below the price of the underlying shares, the ATM call is the strike price that is closest to the current price of the underlying shares, and the OTM call has a strike price that is above the price of the underlying shares ...