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What are OTM options?
Out of the Money (OTM)”” refers to an option contract that only has extrinsic (time) value and no intrinsic value. These options have a delta of less than 50.0.
An OTM call option has a strike price higher than the market price of the underlying asset.
An OTM put option has a strike price lower than the market price of the underlying asset.
OTM options generally have less extrinsic (time) value than In the Money (ITM) options. This makes them more appealing to traders with smaller capital. OTM options are often used in strategies like covered calls or protective puts.
With Shoonya, you can trade OTM options (3-month contracts). There are no restrictions on trading OTM options.
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