Covered Call Calculator Guide
A covered call calculator helps you analyze potential trades before executing them. Here's how to use one effectively.
Key Metrics to Calculate
1. Premium Income
The amount you receive for selling the call option.Formula: Premium = Option Price × 100 shares
2. Static Return (If Unchanged)
Return if stock closes exactly at current price at expiration.Formula: Static Return = Premium / Stock Price × 100
3. Return If Called
Maximum return if stock closes above strike price.Formula: If Called Return = (Premium + (Strike - Stock Price)) / Stock Price × 100
4. Annualized Return
Return projected over a full year.Formula: Annualized = Return × (365 / Days to Expiration)
5. Break-Even Price
Stock price where you start losing money.Formula: Break-Even = Stock Purchase Price - Premium Received
Example Calculation
AAPL Covered Call:
Results:
Use our free covered call calculator to run these calculations instantly.