A share of Disney stock is currently valued at $60 on the market. If the strike price of a call option on this stock is $65 then the call is out of the money.
Financial contracts known as call options provide the option buyer the right, but not the duty, to purchase a stock, bond, commodity, or other asset or instrument at a certain price within a predetermined window of time. The underlying asset is a stock, bond, or other thing. When the value of the underlying asset rises, the call buyer profits.
When compared to a call option, a put option entitles the holder to sell the underlying asset at a fixed price on or before the expiration date.
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