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Covered call calculator

A covered call means owning 100 shares per contract and selling a call option on them. You keep the premium. If the stock ends above the strike, your shares are sold at the strike (called away), capping your profit; if it falls, the premium cushions the loss.

Contracts (100 shares each)

Your cost per share ($)

Current stock price ($)

Call strike price ($)

Premium received per share ($)

Days until expiration

Premium received–

Max profit (if called)–

Breakeven price–

Return if stock unchanged–

Return if called–

Annualized return if called–

Downside cushion–

Returns are on your cost basis, before commissions and taxes.

Covered call formulas

Premium = premium per share × 100 × contracts. Max profit = (strike − your cost + premium) × shares. Breakeven = your cost − premium. Return if unchanged = premium ÷ cost. Return if called = (strike − cost + premium) ÷ cost. Annualized = return × 365 ÷ days to expiration. Downside cushion = premium ÷ current price.

Common questions

What is the max profit on a covered call?

(Strike − your cost per share + premium) × 100 per contract. Above the strike, further gains go to the option buyer.

What is the breakeven on a covered call?

Your cost per share minus the premium received per share.

What happens if the stock falls?

You keep the premium, but you still own the shares and absorb the loss below the breakeven price.

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Last reviewed October 31, 2026. This calculator gives estimates for education and planning only. Results depend entirely on the numbers you enter and the assumptions stated on this page; they are not investment, tax or trading advice, and real results will differ.