LCM of two numbers

Profit for Call Buyer Calculator

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✖Price of Underlying at Expiration refers to the value of the underlying asset of a financial derivative, such as a stock, commodity, or currency, at the time the derivative contract expires.ⓘ Price of Underlying at Expiration [S_T]			+10% -10%
✖The Exercise Price, also known as the strike price, is the predetermined price at which the owner of a financial derivative, such as an option or a warrant, can buy or sell the underlying asset.ⓘ Exercise Price [X]			+10% -10%
✖Call Premium is the price paid by the buyer of a call option to the seller in exchange for the right to buy the underlying asset at a specified price on or before the expiration date of the option.ⓘ Call Premium [c₀]			+10% -10%

✖The Profit for Call Buyer, also known as the long call position, represents the net gain or loss realized by the buyer of a call option at expiration, based on the price of the underlying asset.ⓘ Profit for Call Buyer [Pft]

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Profit for Call Buyer Solution

STEP 0: Pre-Calculation Summary

Formula Used

Profit for Call Buyer = max(0,Price of Underlying at Expiration-Exercise Price)-Call Premium
Pft = max(0,S_T-X)-c₀
This formula uses 1 Functions, 4 Variables

Functions Used

max - Maximum of a function is the highest value that the function can output for any possible input., max(a1, …, an)

Variables Used

Profit for Call Buyer - The Profit for Call Buyer, also known as the long call position, represents the net gain or loss realized by the buyer of a call option at expiration, based on the price of the underlying asset.
Price of Underlying at Expiration - Price of Underlying at Expiration refers to the value of the underlying asset of a financial derivative, such as a stock, commodity, or currency, at the time the derivative contract expires.
Exercise Price - The Exercise Price, also known as the strike price, is the predetermined price at which the owner of a financial derivative, such as an option or a warrant, can buy or sell the underlying asset.
Call Premium - Call Premium is the price paid by the buyer of a call option to the seller in exchange for the right to buy the underlying asset at a specified price on or before the expiration date of the option.

STEP 1: Convert Input(s) to Base Unit

Price of Underlying at Expiration: 29 --> No Conversion Required
Exercise Price: 26 --> No Conversion Required
Call Premium: 1.5 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

Pft = max(0,S_T-X)-c₀ --> max(0,29-26)-1.5

Evaluating ... ...

Pft = 1.5

STEP 3: Convert Result to Output's Unit

1.5 --> No Conversion Required

FINAL ANSWER

1.5 <-- Profit for Call Buyer

(Calculation completed in 00.004 seconds)

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Created by Kashish Arora

Satyawati College (DU), New Delhi

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< Forex Management Calculators

Black-Scholes-Merton Option Pricing Model for Call Option

LaTeX Go Theoretical Price of Call Option = Current Stock Price*Normal Distribution*(Cumulative Distribution 1)-(Option Strike Price*exp(-Risk Free Rate*Time to Expiration of Stock))*Normal Distribution*(Cumulative Distribution 2)

Cumulative Distribution One

LaTeX Go Cumulative Distribution 1 = (ln(Current Stock Price/Option Strike Price)+(Risk Free Rate+Volatile Underlying Stock^2/2)*Time to Expiration of Stock)/(Volatile Underlying Stock*sqrt(Time to Expiration of Stock))

Black-Scholes-Merton Option Pricing Model for Put Option

LaTeX Go Theoretical Price of Put Option = Option Strike Price*exp(-Risk Free Rate*Time to Expiration of Stock)*(-Cumulative Distribution 2)-Current Stock Price*(-Cumulative Distribution 1)

Cumulative Distribution Two

LaTeX Go Cumulative Distribution 2 = Cumulative Distribution 1-Volatile Underlying Stock*sqrt(Time to Expiration of Stock)

Profit for Call Buyer Formula

LaTeX Go

Profit for Call Buyer = max(0,Price of Underlying at Expiration-Exercise Price)-Call Premium
Pft = max(0,S_T-X)-c₀

What is Profit for Call Buyer?

The profit for a call buyer, also known as the long call position, represents the net gain or loss realized by the buyer of a call option at expiration, based on the price of the underlying asset. It depends on various factors, including the market price of the underlying asset at expiration, the exercise price of the call option, and the premium paid for the option.

How to Calculate Profit for Call Buyer?

Profit for Call Buyer calculator uses Profit for Call Buyer = max(0,Price of Underlying at Expiration-Exercise Price)-Call Premium to calculate the Profit for Call Buyer, The Profit for Call Buyer formula is defined as the long call position, represents the net gain or loss realized by the buyer of a call option at expiration, based on the price of the underlying asset. Profit for Call Buyer is denoted by Pft symbol.

How to calculate Profit for Call Buyer using this online calculator? To use this online calculator for Profit for Call Buyer, enter Price of Underlying at Expiration (S_T), Exercise Price (X) & Call Premium (c₀) and hit the calculate button. Here is how the Profit for Call Buyer calculation can be explained with given input values -> 1.5 = max(0,29-26)-1.5.

FAQ

What is Profit for Call Buyer?

The Profit for Call Buyer formula is defined as the long call position, represents the net gain or loss realized by the buyer of a call option at expiration, based on the price of the underlying asset and is represented as Pft = max(0,S_T-X)-c₀ or Profit for Call Buyer = max(0,Price of Underlying at Expiration-Exercise Price)-Call Premium. Price of Underlying at Expiration refers to the value of the underlying asset of a financial derivative, such as a stock, commodity, or currency, at the time the derivative contract expires, The Exercise Price, also known as the strike price, is the predetermined price at which the owner of a financial derivative, such as an option or a warrant, can buy or sell the underlying asset & Call Premium is the price paid by the buyer of a call option to the seller in exchange for the right to buy the underlying asset at a specified price on or before the expiration date of the option.

How to calculate Profit for Call Buyer?

The Profit for Call Buyer formula is defined as the long call position, represents the net gain or loss realized by the buyer of a call option at expiration, based on the price of the underlying asset is calculated using Profit for Call Buyer = max(0,Price of Underlying at Expiration-Exercise Price)-Call Premium. To calculate Profit for Call Buyer, you need Price of Underlying at Expiration (S_T), Exercise Price (X) & Call Premium (c₀). With our tool, you need to enter the respective value for Price of Underlying at Expiration, Exercise Price & Call Premium and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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