ITM (In the Money), ATM (At the Money), and OTM (Out of the Money) are three reflective terms in binary options trading. ATM is stated when the price of a binary asset has a 50% chance to either fall or rise below or above the strike price. As for the reverse, when the price of an asset is far beyond the strike price, it is OTM.
When the price of an asset is already reciprocating as per the traders’ prediction, it is Binary Options In the Money or ITM. A binary options asset is in-the-money when the indicative market price is above the strike price by even just one point or tick.
If you are willing to take the chance to trade binary options, it is better to invest in the ITM assets. It is because they have the potential of helping you earn big profits.
With ITM binary options assets, there are 3 possibilities of making profits, which include:
- Indicative price keeps moving in the upwards direction.
- The market remains flat without any movement.
- The indicative price lowers down but stays above the strike price by one or two points.
With these possibilities, the winning ratio for a trade increases, and so does the profit potential! For example, suppose you invested $100 on an ITM asset. And it expires with just one point above the strike price; you still get the profit payout. Therefore, if you are willing to commence with binary options trading, then prefer the assets that are In-the-Money.