What Is The Value Of A Call Or Put Option?

A Call option represents the right (but not the requirement) to purchase a set number of shares of stock at a pre-determined "strike price" before the option reaches its expiration date. A call option is purchased in hopes that the underlying stock price will rise well above the strike price, at which point you may choose to exercise the option. Exercising a call option is the financial equivalent of simultaneously purchasing the shares at the strike price and immediately selling them at the now higher market price.

A Put option represents the right (but not the requirement) to sell a set number of shares of stock (which you do not yet own) at a pre-determined "strike price" before the option reaches its expiration date. A put option is purchased in hopes that the underlying stock price will drop well below the strike price, at which point you may choose to exercise the option.
     
  Call/Put Assumptions

Input
Analyze a Call or Put option? Call   Put
  Total purchase price of option
  Total number of shares controlled
  Strike price: (per share)
  Current price: (per share)
     
 

Any rate of return entered into the calculator to project future values should be a reasonable average return for the period. Rates of return will vary over time, and generally the higher the rate of return the higher the degree of risk.

The information provided here is to assist you in planning for your future. The accuracy of this calculator and its applicability to your circumstances is not guaranteed. Any analysis is a result of the information you have provided. Material discussed is meant for general illustration and/or informational purposes only and it is not to be construed as tax, legal, or investment advice. Although the information has been gathered from sources believed to be reliable, please not that individual situations can vary. Therefore, the information should be relied upon when coordianted with individual advice from qualified professionals.