Options Strike Price

When the Strike price

• is same as the stock price, it's known as At The Money (ATM)
• is below the stock price, it's known as In The Money (ITM)
• is above the stock price, it's known as Out Of Money (OOM)

Option Strike Prices range

For stock Price range from $5 to $25 , strike price increase by $ 2.5 interval, ie

• 5,7.5, 10, 12.5,15....22.5, & $ 25

For stock price range, $ 25- $ 200, strike price increase by $ 5 interval

• 30, 35,40,45,50....195 & $ 200

For stock price $ 200 and above, strike price increase by $ 10 interval

• 210, 220, 230 .....etc

Which strike price to Choose?

When you buy or sell the option contract, you have to decide which strike price to choose. To play safe, I would either use the ATM or ITM.

Say you are buying a CALL and the stock price is $45 and you believe it will go up in the near future, you can buy the ATM @ $ 45 or the ITM @ $ 40. If you buy the OOM call @ $ 50 and you are wrong, you could potentially lose all the money on this trade without hedging it against a put options.