“Moneyness” refers to the relationship between the strike price of the option and the current price of the underlying asset.

– In-the-Money (ITM): A call option is ITM if the underlying asset’s price is above the strike price. A put option is ITM if the underlying asset’s price is below the strike price.

– At-the-Money (ATM): An option is ATM if the underlying asset’s price is equal to the strike price.

– Out-of-the-Money (OTM): A call option is OTM if the underlying asset’s price is below the strike price. A put option

is OTM if the underlying asset’s price is above the strike price.

Each of these scenarios implies different profit and loss potentials and is a factor in the pricing of the option premium.

– Reference: [Investopedia: In-the-Money (ITM), At-the-Money (ATM), Out-of-the-Money (OTM)](https://www.investopedia.com/terms/m/moneyness.asp)