Calculate options trading profit/loss for calls and puts with strike price, premium, breakeven, and payoff diagrams.
An option's strike is not its profit threshold once the premium is included. This calculator evaluates a purchased call or put at expiration using the strike, premium, and underlying price. It reports profit or loss, identifies the breakeven price, and shows how the payoff changes across possible expiration prices. The common mistake is comparing the underlying price only with the strike: the option must first recover its premium. Premium units also matter because a per-share quote and a total contract cost are not interchangeable.
A concrete input and expected output from the current implementation.
Input
Position: buy 1 call Strike price: $100 Premium: $5 per share Underlying price at expiration: $112 Contract multiplier: 100
Expected output
Breakeven: $105 per share. Intrinsic value at expiration: $12 per share, or $1,200 for the contract. Premium paid: $500. Net profit: $7 per share, or $700 for the contract.
The call is worth $112 - $100 = $12 per share at expiration. Subtracting the $5 premium leaves $7 per share, and $7 x 100 = $700.
For a purchased call at expiration, intrinsic value per share is the greater of the expiration price minus the strike or zero. Net profit or loss is intrinsic value minus the premium. The call breakeven is strike plus premium. Below the strike, the call has no intrinsic value; above it, the payoff increases dollar for dollar with the underlying price.
For a purchased put, intrinsic value per share is the greater of the strike minus the expiration price or zero. Net profit or loss is that amount minus the premium, and breakeven is strike minus premium. The payoff diagram shows the premium-loss region, the breakeven crossing, and the increasing put value as the underlying falls below the strike.
No. A purchased call must finish above the strike by the premium paid, so its breakeven is strike plus premium. A purchased put must finish below the strike by that premium, so its breakeven is strike minus premium. These are expiration breakevens and do not describe the price at which the option itself could be sold earlier.
For a purchased call, the expiration loss is limited to the premium while profit is not capped by the basic payoff formula. For a purchased put, the underlying cannot fall below zero, so the highest net expiration payoff per share is the strike minus the premium. These statements exclude transaction costs and assume the stated contract multiplier.
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