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Trends & Analysis
News

TJX announces strong sales, dividend hike

News

Who wins the S&P 500’s bank battle?

News

USD/JPY edges lower on economic data

News

Li Auto shares race ahead on upbeat earnings

News

Can anything stop NVIDIA?

News

Gold rises on soft dollar, geopolitical concerns

At the money definition

At the money is a term used in options trading when the strike price of an option is equal or very close to the currency market price of the underlying asset. At the money options are considered neutral, and they have an equal chance of expiring in the money or out of the money. At the money options may occur in various financial markets, such as stocks, currencies, and commodities.

An example of an at the money option

A trader purchases a call option on a stock with a strike price of $100. If the current market price of the stock reaches $100, the option will be at the money. This means that the option has not yet gained or lost intrinsic value, and there is an equal chance of the market price moving in either direction. Should the stock price increase beyond $100, the option will become in the money. On the other hand, should it decrease below $100, the option will become out of the money.

What to do with an at the money option

If you have an at the money option contract, the best course of action depends on your trading strategy, investment objectives, and the current market outlook.
If you have a call option and foresee the asset’s market price will rise, you may exercise your option to buy the asset at the strike price and sell it at a higher price later. If you foresee the asset’s price will fall, you may sell the option to another trader for profit instead of exercising it.
If you have a put option and foresee the asset’s market price will fall, you may exercise your option to sell the asset at the strike price and buy it back at a higher price later. If you foresee the asset’s price will rise, you may sell the option to another trader for profit instead of exercising it.
Regardless, it is important to note there are risks involved in options trading to be cautious of. Before making any investment decisions, you should ensure you understand these risks.

 

Start trading with ADSS

ADSS offers a range of global markets for traders, with CFD opportunities in indices, commodities, forex, equities and more. We also feature tutorials, how-to guides, and weekly webinars to help you navigate the financial markets and find better trading opportunities. You can start trading and investing online by opening a live trading or demo trading account.

 

See all glossary trading terms


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Investing in CFDs involves a high degree of risk that you will lose your money due to the use of leverage, particularly in fast moving markets, where a relatively small movement in the price can lead to a proportionately larger movement in the value of your investment. This can result in loses that exceed the funds in your account. You should consider whether you understand how CFDs work and you should seek independent advice if necessary.

ADS Securities LLC (“ADSS”) is authorised and regulated by the Securities and Commodities Authority (“SCA”) in the United Arab Emirates as a trading broker for Over the Counter (“OTC”) Derivatives contracts and foreign exchange spot markets. ADSS is a limited liability company incorporated under United Arab Emirates law. The company is registered with the Department of Economic Development of Abu Dhabi (No. 1190047) and has its principal place of business at 8th Floor, CI Tower, Corniche Road, P.O. Box 93894, Abu Dhabi, United Arab Emirates.

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ADSS is an execution only service provider and does not provide advice. ADSS may publish general market commentary from time to time. Where it does, the material published does not constitute advice, or a solicitation, or a recommendation to a transaction in any financial instrument. ADSS accepts no responsibility for any use of the content presented and any consequences of that use. No representation or warranty is given as to the completeness of this information. Anyone acting on the information provided does so at their own risk.