Probability of Touch (POT)
An estimate of the probability that the underlying touches a specific price level before expiration.
Explanation
POT is generally higher than probability of finishing beyond that level at expiration because the underlying can cross a level intraday and then reverse. Traders use POT for stop placement, strike risk assessment, and management planning for short options.
Example
A short 160 call may have 18% chance of expiring ITM but 30% probability of being touched before expiration.