How to Calculate Options Profit and Breakeven

Options Profit At Expiration

Profit or loss on an option depends on whether the stock price moves beyond your breakeven point. For every standard contract, you control 100 shares of the underlying stock.

The Formulas

• Long Call: (Stock Price - Strike) - Premium Paid
• Long Put: (Strike - Stock Price) - Premium Paid
• Covered Call: Premium Received + (Stock Gain capped at Strike)

FAQ: Options Math

What is the 100 multiplier?

In the U.S., one standard equity option contract represents 100 shares. If an option is priced at $2.50, the actual cost is $250.00.

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