A Put Option is said to be ‘In the Money’ if its strike price is more than the current stock price in the cash segment of the market. Exercising an ‘In the Money’ Put Option will lead to profit for the option holder.

Put Option is ‘At the Money’ if its strike price is equal to price of the underlying i.e. current stock price in the cash segment of the market. Exercising an ‘At the Money’ Option will lead to no profit / no loss situation for the option holder.

Put Option is said to be ‘Out of the Money’ if its strike price is less than the current stock price in the cash segment of the market. Option holder must not exercise an ‘Out of the Money’ option.

E.g. If share price of ABC Ltd is Rs. 100 in the cash market, a put option will strike price of 110 is ‘In the Money’ Put option, whereas put option with strike price of 90 is ‘Out of Money’ option and put option with strike price 100 is ‘At the Money’ Put option.