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Define: Out of The Money Options



Out of The Money Options are options that have no built-in value.

Out of The Money Options are options that do not have any value exercising at all. These are call options that allow you to buy the underlying stock at a price higher than the prevailing stock price and put options that allow you to sell the underlying stock at a price lower than the prevailing stock price. Buying out of the money options is therefore good only for speculative purpose.

Read the full tutorial on Out of The Money Options.