At the money (ATM)
An option whose strike is at or very near the current stock price. ATM options carry the most extrinsic value, the fastest time decay, and deltas near 0.50.
The at-the-money strike is where uncertainty is greatest — the option is a near coin-flip to finish with value — so the market prices the most time value there. It is also where gamma and theta peak, which makes ATM options the fastest-moving and fastest-decaying instruments on the chain.
Straddles are bought and sold at this strike precisely because it is the purest bet on movement versus premium.
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