At-the-money forward

(1) An option is said to be at-the-money forward when, at a specific point in time, the exercise price is equal to the forward price of the underlying, or at-the-money spot when, at a specific point in time, the exercise price is equal to the spot price of the underlying. (2) By extension, this term is sometimes used to describe an option whose exercise price approximates the market price of the underlying at a specific point in time. In this case, the term close-to-the-money is more commonly used. (3) Also by extension, this term is used to describe a futures or forward contract whose forward price is equal to the spot market price of the underlying.