- Trade options, futures, options on futures, stocks, ETFs
- $0 commission to close options
- Pro-grade platform and risk analysis tools
Evaluating the risk/reward profile of a trade is an important part of trading options, helping you make more informed decisions and optimize your strategies.
Our investment calculator helps you estimate profits and losses for call options and put options by considering various factors such as strike price, premium, share price and number of contracts.
Input your details to quickly see the potential outcomes of your options trades.
Options Investment Calculator
Estimated Profit: $0.00
How to use this calculator
Enter the following details to estimate your options profit or loss:
- Option Type. Choose between a call option or a put option, depending on your strategy.
- Strike Price. Enter the option contract’s strike price, which is the price you can buy or sell the stock.
- Premium Paid. Enter the premium, which is the price you pay for the contract.
- Share Price. Enter the stock’s projected share price at expiration.
- Number of Contracts. Enter the number of contracts you’d like to purchase.
Call options profit formula
Use the following formula to calculate the potential profit from a call option, assuming it’s in the money at expiration:
Profit = (Stock Price at Expiration – Strike Price – Premium Paid) * Number of Contracts * 100
If the stock price at expiration is below or equal to the strike price, the option expires out of the money. The profit is the negative of the premium paid because the option expires worthless.
Put options profit formula
Use the following formula to calculate the potential profit from a put option, assuming it’s in the money at expiration:
Profit = (Strike Price – Stock Price at Expiration – Premium Paid) * Number of Contracts * 100
If the stock price at expiration is above or equal to the strike price, the option expires out of the money. The profit is the negative of the premium paid since the option expires worthless.
The basics of options trading
Options trading is a strategy that gives you the flexibility to buy or sell a stock at a set price within a specific timeframe, which can be a powerful tool for both managing risk and pursuing bigger returns.
It’s different from regular stock trading because it lets you speculate on price movements or protect your investments with more precision.
You might buy a call option if you believe the price of a stock will rise above the option’s strike price before the option expires. This allows you to purchase the stock at a lower price and potentially sell it at a higher market value for a profit.
On the other hand, you might buy a put option if you believe the price of a stock will decline before the option expires. This gives you the right to sell the stock at a higher strike price, which can either protect your investment from losses or allow you to profit from the drop in the stock’s value.
If you’re looking to explore options trading further, understanding the basics of options trading and finding the right platforms can be key to getting started.
Our top picks for options trading platforms
- No options commissions, per-contract fees or exercise and assignment fees
- Build a wide range of basic and advanced options strategies
- Earn 4.5% interest on uninvested cash with Gold
- $0 commission on stocks, ETFs and options, with no options contract fees
- Complimentary access to a financial planner
- Trade stocks, options, ETFs, mutual funds, alternative asset funds
More guides on Finder
-
Best Paper Trading Apps to Practice Trading With Fake Money in 2024
Some of the best paper trading apps to practice stock trading with fake money include Interactive Brokers, eToro, Charles Schwab and more.
-
5 Best International Stock Brokers to Invest in Foreign Assets
Want to buy and sell international stocks? Here are the top brokers to help you trade global markets.
-
9 Best Discount Brokers of 2024 for Low-Cost Trading
These are the best discount brokers of 2024 according to Finder’s comprehensive review.
-
9 Best Robo-Advisors for Automatic Investing
The best platforms to use for automatic investing include Wealthfront, SoFi, Schwab, Vanguard, Titan, Acorns and more. See our full list here.
-
5 Top Graphene Stocks to Invest in Today
We’ve rounded up stats on some of the most popular graphene stocks, along with information on how they compare and how to invest.
-
Betterment alternatives
5 Betterment robo-advisor alternatives to consider when building your portfolio.
-
How to invest in the S&P 500 in 2024
What you need to know about investing in the leading indicator for the overall US stock market.
-
How to gift stock
How do you gift stocks to loved ones? Learn the ins and outs of finding the right investments for them.
-
5 best ETFs for 2024
Check out the best-performing ETFs so far in 2024.
-
Acorns review 2024
Acorns is a financial service that rounds up your purchases and turns the extra change into investments.
Ask a question