What is a strike price?
The strike price is the fixed price at which an option can be exercised. Learn what it means and how to pick one.
The strike price is the fixed price at which an option lets you buy (call) or sell (put) the underlying. Every row in the option chain is a different strike.
How strikes relate to the price
- ATM (at-the-money): strike ≈ current price. Highlighted in the chain; most sensitive to moves.
- ITM (in-the-money): a call strike below the price / a put strike above it — already has intrinsic value, costs more.
- OTM (out-of-the-money): a call strike above the price / a put strike below it — cheaper, all time value.
Deep dive: ITM, ATM & OTM options.
How to pick a strike
- ATM — balanced cost and sensitivity; good default for directional trades and scalping.
- OTM — cheap lottery-style bets; need a bigger move.
- ITM — behave more like the underlying; higher cost, higher delta.
FAQ
What is the ATM strike?
The strike closest to the current spot price — it's highlighted in the option chain.
Which strike is cheapest?
OTM strikes are cheapest (all time value), but need a larger move to profit.
How far apart are strikes?
By a fixed interval per instrument (e.g. NIFTY every 50 points) — visible as the rows in the chain.