How the options profit calculation works
At expiration, a long call is worth the greater of zero or the underlying price minus the strike. A long put is worth the greater of zero or the strike minus the underlying price. Multiply that intrinsic value by 100 shares per standard equity-option contract and the number of contracts, then subtract the premium paid.
The calculator assumes the premium input is quoted per share, as equity options normally are. A premium of $2.50 therefore costs $250 for one standard contract before commissions and fees.
Breakeven and maximum loss
A long call’s expiration breakeven is strike plus premium. A long put’s expiration breakeven is strike minus premium. The maximum loss for either long option is the premium paid, assuming the position is not exercised or managed in a way that creates additional underlying exposure.
Before expiration, option value also includes remaining time value and depends on implied volatility, rates and dividends. A contract can show a gain or loss different from this expiration-only model even when the underlying is at the same price.
- Long call profit: max(0, price − strike) − premium, multiplied by shares and contracts.
- Long put profit: max(0, strike − price) − premium, multiplied by shares and contracts.
- Standard multiplier: 100 shares per contract unless the contract is adjusted.
- Commissions, fees, slippage and assignment consequences are excluded.
Use payoff scenarios, not a single forecast
A target price is not a probability. Compare several expiration values, note how much of the premium can be lost and decide whether the risk fits your plan. For positions that will be closed before expiration, an option-pricing model and volatility scenarios are more appropriate than intrinsic payoff alone.
This calculator checks arithmetic; it does not estimate the likelihood of a result or recommend a trade. Verify the contract multiplier and settlement rules for the specific option you are evaluating.