At-the-Money
Definition
An option whose strike price equals (or is very close to) the current market price of the underlying asset.
Explanation
At-the-money (ATM) options have the highest time value and are the most sensitive to changes in implied volatility (highest vega). An ATM call and ATM put with the same expiration will have approximately equal premiums due to put-call parity. ATM options have a delta of approximately 0.50 for calls and -0.50 for puts, meaning they move roughly 50 cents for every $1 move in the underlying.