Covered-call calculator

Max profit on a covered call is (strike − cost basis) + premium collected, realised if the stock closes at or above the strike at expiry. Below the strike, your profit is the premium collected plus or minus the change in stock price from your cost basis.

The break-even is your cost basis minus the premium received per share. If the stock closes there at expiry, you've offset the entire premium against your share-price loss and finish flat.

Annualised yield projects what the premium would earn if you could repeat the same trade every period for a year. The formula is (premium / stock price) × (365 / days to expiry) × 100 — a 30-day trade collecting 1.4% becomes ~17% annualised.

Yes. The premium softens the first few dollars of a stock decline, but if the stock falls further than the premium you collected, you have an unrealised loss on the position. Covered calls reduce risk relative to holding the shares alone, but they don't eliminate it.

You need the current stock price, the strike of the call you're selling, the premium per share quoted on the option chain, and the days remaining until expiry. The calculator handles the rest.