Hanging Indentation of Theorem Environments

Question

I wish to have my theorem environments (theorem, lemma, corollary, definition) etc have a hanging indentation as follows:

Theorem 1:  This is the one, It should be emphasized that an option gives the holder the 
            right to do something.The holder does not have to exercise this right. This 
            is what distinguishes options from forwards and futures, where the holder is 
            obligated to buy or sell the underlying asset.

However, I am failing to produce this type of hanging indentation and below is the MWE which I got from How can I change the typeface used in my theorem environments :

\documentclass{article}
\usepackage[T1]{fontenc}
\usepackage{amsmath,amsthm}
\usepackage{xcolor}

\newtheoremstyle{mytheoremstyle} % name
{\topsep}                    % Space above
{\topsep}                    % Space below
{\itshape\fontfamily{ptm}\selectfont}                   % Body font
{}                           % Indent amount
{\fontfamily{ptm}\selectfont\scshape\color{blue}}                   % Theorem head font
{:}                          % Punctuation after theorem head
{.5em}                       % Space after theorem head
{}  % Theorem head spec (can be left empty, meaning ‘normal’)
\theoremstyle{mytheoremstyle}
\newtheorem{lemma}{Lemma}

\usepackage{lipsum}

\begin{document}
    \begin{lemma}[foo bar]
        \lipsum[3]
    \end{lemma}
    
\end{document}

Answer 1

Some what manual suggestion, but it works as per your wish:

\documentclass{article}
\usepackage[T1]{fontenc}
\usepackage{amsmath,amsthm}
\usepackage{xcolor}

\newbox\thmbox%
\setbox\thmbox=\hbox{\fontfamily{ptm}\selectfont\scshape\color{blue}Lemma 1 (foo bar)}%
\newtheoremstyle{mytheoremstyle} % name
{\topsep}                    % Space above
{\topsep}                    % Space below
{\hangindent\wd\thmbox\itshape\fontfamily{ptm}\selectfont}                   % Body font
{}                           % Indent amount
{\fontfamily{ptm}\selectfont\scshape\color{blue}}                   % Theorem head font
{:}                          % Punctuation after theorem head
{.5em}                       % Space after theorem head
{}  % Theorem head spec (can be left empty, meaning ‘normal’)
\theoremstyle{mytheoremstyle}
\newtheorem{lemma}{Lemma}

\usepackage{lipsum}

\begin{document}
    \begin{lemma}[foo bar]
        \lipsum[3]
    \end{lemma}
    
\end{document}

Answer 2

You could add

\hangafter=1\hangindent=3em

to the argument of the "Body font" line of the \newtheoremstyle directive:

{\itshape\fontfamily{ptm}\selectfont\hangafter=1\hangindent=3em}

I would recommend that you not make the indentation amount (3em in the lines above) depend on whether the theorem-like environment is called Lemma (a fairly short string) or Proposition (a fairly long string). Just choose a value that will guarantee that your readers will have no choice but to notice that hanging indentation is in force.

---

\documentclass{article}
\usepackage[T1]{fontenc}
\usepackage{amsmath,amsthm}
\usepackage{xcolor,lipsum}

\newtheoremstyle{mytheoremstyle} % name
{\topsep}                    % Space above
{\topsep}                    % Space below
{\itshape\fontfamily{ptm}\selectfont\hangafter=1\hangindent=3em} % Body font
{}                           % Indent amount for first line
{\fontfamily{ptm}\selectfont\scshape\color{blue}}        % Theorem head font
{.}                          % Punctuation after theorem head
{.5em}                       % Space after theorem head
{}  % Theorem head spec (can be left empty, meaning ‘normal’)
\theoremstyle{mytheoremstyle}
\newtheorem{lemma}{Lemma}

\begin{document}
    \begin{lemma}[foo bar] 
    \lipsum[3][1-8]
    \end{lemma} 
\end{document}