An option that has no value. A call option, which gives the holder the right to buy a security, is out-of-the-money when the price of the underlying security is below the optionÂ’s strike price. If the security can be bought for less money in the open market, no option is needed. A put option, which gives the holder the right to sell a security, is out-of-the-money when the security can be sold in the market for a higher price.