Put Option Calculator
Enter the asset price, strike price, put price and number of contracts to see the total cost, profit or loss, return and break-even price.
Updated
Put Option Calculator
Our Put Option Calculator tells you what a bought put is worth if the underlying asset trades at a price you choose. Type the asset price, the strike price, the put price (the premium per share) and how many contracts you hold. It returns the total premium, the profit or loss, the return on the premium, the break-even price and the most the trade can make. Each contract is counted as 100 shares. It suits traders testing a bearish view, shareholders pricing downside protection and students learning option payoffs.
Quick answer
Put profit is (strike price − asset price) × 100 × contracts − total premium: with a share at 84, a strike of 100, a premium of 5 and 3 contracts, (100 − 84) × 300 − 1,500 = 3,300, a 220% return.
- Total cost: put price × 100 × number of contracts.
- Break-even price: strike price − put price.
- Maximum profit: (strike price − put price) × 100 × contracts, if the asset falls to zero.
- Maximum loss: the premium paid, when the asset ends at or above the strike.
What Is a Put Option?
A put option is a contract that gives its buyer the right, but not the obligation, to sell an asset at a fixed price (the strike price) on or before an expiry date. The buyer pays a premium to the seller for that right. A put gains value as the asset falls, so it is used either to profit from a drop or to protect shares you already own.
- Asset price: the market price of the underlying share, index or other asset that you want to test.
- Strike price: the price at which the put lets you sell.
- Put price (premium): the cost of the option, quoted per share.
- Contracts: a standard equity option contract covers 100 shares.
This page covers buying a put (a long put). For the mirror-image trade that gains when prices rise, see the Call Option Calculator.
Put Option Profit Formula
Intrinsic value
= max(0, K − S) × 100 × N
Profit = Intrinsic − Total cost
Return % = Profit ÷ Cost × 100
- K: the strike price.
- S: the asset price.
- P: the put price (premium) per share.
- N: the number of contracts, each covering 100 shares.
The order of the subtraction is what separates a put from a call: a put uses strike minus asset price, so it is worth more the lower the asset goes. When the asset is above the strike, K − S is negative, the max(0, ...) rule sets intrinsic value to zero and you would let the put expire. The asset price you enter is treated as the price at exercise or expiry.
How to Calculate Put Option Profit
You buy 3 put contracts with a strike price of 100 and pay a premium of 5 per share. At expiry the share has dropped to 84:
Intrinsic = (100 − 84) × 300
= 4,800
Profit = 4,800 − 1,500 = 3,300
Return = 3,300 ÷ 1,500 × 100
= 220%
- Work out what you paid. Premium × 100 × contracts: 5 × 100 × 3 = 1,500.
- Work out what the puts are worth. Strike minus asset price, times the 300 shares covered: 16 × 300 = 4,800.
- Take the cost away. 4,800 − 1,500 = 3,300 profit.
- Turn it into a return. 3,300 ÷ 1,500 = 2.2, which is 220% of the premium.
Break-Even Price of a Put Option
= 100 − 5 = 95
Break-even is the asset price at which the put is worth exactly what it cost. It is the same for 1 contract or 50. Between break-even and the strike the put is in the money but still loses: at 97 the three contracts are worth 3 × 300 = 900 against a cost of 1,500, a loss of 600 (−40%).
Maximum Profit and Maximum Loss
= (Strike − Premium) × 100 × N
= (100 − 5) × 300 = 28,500
Max loss = Premium × 100 × N
= 5 × 300 = 1,500
Unlike a call, a bought put has a ceiling on its profit, because an asset price cannot go below zero. The best case is the asset becoming worthless, which leaves the strike minus the premium on every share. The worst case is the asset finishing at or above the strike: the put expires worthless and the premium is gone, but nothing more. The calculator shows the ceiling as "Maximum profit".
Put Option Examples
A single contract. The share is at 45, the strike is 50, the premium is 1.25 and you hold 1 contract:
Intrinsic = (50 − 45) × 100
= 500
Profit = 500 − 125 = 375
Return = 375 ÷ 125 × 100
= 300%
The share rises instead. The share is at 62, the strike is 55, the premium is 2 and you hold 5 contracts:
Intrinsic = max(0, 55 − 62)
= 0
Profit = 0 − 1,000 = −1,000
Return = −100%
With the share above the strike there is nothing to gain from selling at 55, so the puts expire worthless and the loss is the 1,000 premium.
Using a Put to Protect Shares
A put bought on shares you already hold is called a protective put. It works like insurance: the premium is the cost of cover and the strike is the price you can always sell at. Say you own 300 shares bought at 100 and add the 3 puts from the main example (strike 100, premium 5):
| Share at expiry | Shares plus puts |
|---|---|
| Falls to 84 | Shares −4,800, puts +3,300. Net loss 1,500 |
| Stays at 100 | Shares 0, puts −1,500. Net loss 1,500 |
| Rises to 120 | Shares +6,000, puts −1,500. Net gain 4,500 |
However far the shares fall, the combined loss stops at the 1,500 premium, while gains above the strike are kept less the cost of the cover. To size a hedge, enter one contract for every 100 shares you own.
Buying a Put vs Short Selling
Both trades profit from a falling price. Compare the 3 puts with selling 300 shares short at 100:
| Outcome | 3 puts | Short 300 |
|---|---|---|
| Share at 84 | +3,300 | +4,800 |
| Share at 120 | −1,500 | −6,000 |
| Worst case | −1,500 | No limit |
The short sale earns more on the way down because no premium is paid, but its loss grows without limit as the share rises, and it needs a margin account and borrowed shares. The put costs the premium up front, caps the loss at that premium and expires on a fixed date, so the fall has to happen in time.
What the Result Leaves Out
- Time value. Only intrinsic value is counted. A put with time left normally trades above that figure.
- Volatility and time decay. Day-to-day option prices depend on both and need a pricing model such as Black-Scholes.
- Early exercise and dividends. The result is for one asset price at exercise or expiry.
- Costs. Commissions, exchange fees and taxes are not deducted.
- Other contract sizes. Every contract is taken as 100 shares.
Treat the result as a what-if for one price, not a prediction. It is for education and planning and is not financial advice.
Key Terms
- Put option
- The right to sell an asset at the strike price on or before the expiry date.
- Long put
- A put you have bought. Its loss is limited to the premium.
- Premium
- The price of the option per share, paid by the buyer to the seller.
- Intrinsic value
- Strike price minus asset price, or zero if that is negative.
- Break-even
- Strike price minus premium: the asset price at which profit is zero.
- Protective put
- A put held together with the shares it covers, to limit their downside.
How to Use the Put Option Calculator
- Enter the asset price. Type the price of the underlying asset you want to test, such as 84.
- Enter the strike price. Type the strike price of the put, such as 100.
- Enter the put price. Type the premium per share, such as 5. The calculator multiplies it by 100 for you.
- Enter the number of contracts. Type how many put contracts you hold, such as 3. Each one covers 100 shares.
- Read and copy the result. The profit or loss appears as you type, with the working, total put cost, intrinsic value, return on premium, break-even price, maximum profit and whether the put is in the money. Press Copy to copy it, or Clear or Esc to start again.
Example: asset price 45, strike price 50, put price 1.25 and 1 contract. The result is 375, from (50 − 45) × 100 − 125 = 375, a 300% return on a cost of 125.
Who Can Use This Calculator?
Frequently Asked Questions (FAQs)
How do you calculate the profit on a put option?
Subtract the asset price from the strike price, multiply by 100 and by the number of contracts, then subtract the total premium paid. If the asset price is at or above the strike, the first part is zero and the loss is the premium.
What is the profit on 3 put contracts with a strike of 100 and a premium of 5 if the share falls to 84?
It is 3,300. The contracts cost 5 × 100 × 3 = 1,500 and are worth (100 − 84) × 300 = 4,800, so the profit is 4,800 − 1,500 = 3,300, a 220% return on the premium.
What is the break-even price of a put option?
It is the strike price minus the premium per share. A put with a strike of 100 bought for 5 breaks even when the asset is at 95, and makes money below that.
What is the maximum profit on a put option?
It is (strike price − premium) × 100 × number of contracts, reached only if the asset falls to zero. For 3 contracts with a strike of 100 and a premium of 5 that is 95 × 300 = 28,500.
What is the most you can lose when you buy a put?
The total premium paid: put price × 100 × number of contracts. That happens when the asset is at or above the strike price at expiry and the put expires worthless.
When is a put option in the money?
A put is in the money when the asset price is below the strike price, at the money when the two are equal and out of the money when the asset price is above the strike. In the money does not mean profitable: the asset must also be below the break-even price.
Can I use this calculator for a protective put?
Yes. Enter the strike, the premium and one contract for every 100 shares you own. The total put cost is the price of the protection, and the profit at a lower asset price is what the puts would add back against the loss on your shares.
Does the calculator include time value or fees?
No. It counts intrinsic value only, from the asset price and strike price you enter. Time value, implied volatility, commissions and taxes are left out, so a put that has not expired will usually trade for more than the figure shown.
Is the Put Option Calculator free?
Yes. It is free to use, with no sign-up and no limit on how many times you use it.
Sources
- Corporate Finance Institute. Put Option.
- Options Industry Council. Long Put.
- Options Industry Council. Protective Put (Married Put).
- Corporate Finance Institute. Protective Put.
- Wikipedia. Put option.
- Wikipedia. Moneyness.
- WallStreetMojo. Put Option.
Try our Put Option Calculator to see the cost, profit and break-even price of a put before you trade.