In the Money

mon·ey   (mŭn'ē)    n.   pl. mon·eys or mon·ies A medium that can be exchanged for goods and services and is used as a measure of their values on the market, including among its forms a commodity such as gold, an officially issued coin or note, or a deposit in a checking account or other readily liquefiable account. The official currency, coins, and negotiable paper notes issued by a government. Assets and property considered in terms of monetary value; wealth. Pecuniary profit or loss: He made money on the sale of his properties. One's salary; pay: It was a terrible job, but the money was good. An amount of cash or credit: raised the money for the new playground. Sums of money, especially of a specified nature. Often used in the plural: state tax moneys; monies set aside for research and development. A wealthy person, family, or group: to come from old money; to marry into money. [Middle English moneie, from Old French, from Latin monēta, mint, coinage, from Monēta, epithet of Juno, temple of Juno of Rome where money was coined.]

In The Money

1. For a call option, when the option's strike price is below the market price of the underlying asset.

2. For a put option, when the strike price is above the market price of the underlying asset.

Investopedia Commentary

In other words, this is when your stock option is worth money and you can turn around and sell or exercise it for a profit.

Related Links

Trading The QQQQ With In-The-Money Put Spreads
Options Basics Tutorial
Alternatives to Closing Below Intrinsic Value

See also: At The Money, Call Option, Deep In The Money, Exercise, Intrinsic Value, Option, Out Of The Money, Put Option, Strike Price

Also spelled: In-the-money, inthemoney

money

A generally accepted medium for the exchange of goods and services, for measuring value, or for making payments. Many economists consider the amount of money and growth in the amount of money in an economy very influential in determining interest rates, inflation, and the level of economic activity. There is some disagreement among economists as to what types of things actually should be classified as money; for example, should balances in money market funds be included. See also money supply.

Main Entry: mon·ey
Pronunciation: 'm&-nE
Function: noun
Inflected Form: plural moneys or mon·ies /'m&-nEz/
1 : an accepted or authorized medium of exchange; especially : coinage or negotiable paper issued as legal tender by a government
2 a : assets or compensation in the form of or readily convertible into cash b : capital dealt in as a commodity to be lent, traded, or invested money available from a lender> money supply> c plural : sums of money moneys>

in the money

1. Also, in the chips. Rich, affluent. For example, When he's in the money, he's extremely generous to his friends, or After that box-office bonanza, she's in the chips. The chips in the variant presumably allude to poker chips. [Colloquial; late 1800s]

2. Placing first, second or third in a contest on which a bet has been placed, especially a horse race. For example, My luck held today, and I ended up in the money. [c. 1900]