In the options markets a put option is regarded as being in-the-money if:

Question

Quizplus · Accepted Answer

A put option gives the holder the right to sell the underlying asset at the strike price. If the current market price of the asset is below the strike price, then the put option is in-the-money, as exercising the option would result in a profit. Therefore, option C is the correct answer. Option A is not relevant to determining whether a put option is in-the-money. Option B is misleading, as the value of the option depends on various factors, not just its initial price. Option D is incorrect, as the option premium is already factored into the strike price.

In the Options Markets a Put Option Is Regarded as Being