Covered Calculator View

The Covered Calculator is a view on the Calls and Puts Option Chains which shows calculations for Covered Call (Buy-Write & Unwind) or Covered Put (Sell-Write & Unwind) trades.

Commissions and dividends are not included in the calculations, so be mindful of their effect and timing.

Inputs
Stock Price	Choose to base the calculations using a stock price from the market: Ask for Covered call calculations and Bid for Covered Put calculations, or input a cost you want to use as the stock price. The input cost is loaded with an average cost from your account when that is available. If the Bid/Ask Prices are chosen, the calculations will stay updated based on changes in the stock price. Calculations will stay updated with quote changes in the option prices.
Shares	Enter the number of shares you would like to run the calculations with. The calculations will assume 1 option is traded for every 100 shares .
Target Price	Used to calculate the return on the covered call or covered put strategy if the target price is reached.

Inputs

Stock Price

Choose to base the calculations using a stock price from the market: Ask for Covered call calculations and Bid for Covered Put calculations, or input a cost you want to use as the stock price.

The input cost is loaded with an average cost from your account when that is available.
If the Bid/Ask Prices are chosen, the calculations will stay updated based on changes in the stock price.
Calculations will stay updated with quote changes in the option prices.

Enter the number of shares you would like to run the calculations with. The calculations will assume 1 option is traded for every 100 shares .

Target Price

Used to calculate the return on the covered call or covered put strategy if the target price is reached.

Outputs
Max Gain	Shows in Dollars the maximum amount you could make from that trade. This would assume that the option expires with an assignment. If assigned on Calls, you would be selling the stock, and if assigned on puts you would be buying the stock back. Call Calculation: ((Call strike price) - (either Stock Ask or input stock price, depending on stock price chosen) + (call bid)) shares input * option multiplier, usually 100)* Put Calculation: ((either Stock Bid or input stock price, depending on stock price chosen) + (put bid) - (Put strike price)) shares input * option multiplier, usually 100)*
% Max Gain	The % return if the max gain is reached, expressed as a % of the initial investment price, calculated as follows: Call Calculation: Max Gain / ((stock Ask or input cost – Call Bid)share quantity)* Put Calculation: Max Gain/ ((stock Bid or input cost + Put Bid)share quantity)*
Static ROI	Static Return on Investment shows in Dollars the return if the stock price did not move from the current price and the option was to expire. Calculations: If stock would be assigned, uses the Max Gain calculations above If stock would not be assigned, Call Calculation: Call Bid share quantity* Put Calculation: Put Bid share quantity*
% Static ROI	The Static ROI represented as a %. Call Calculation: Static ROI / ((stock Ask or input cost – Call Bid)share quantity) Put Calculation:* Static ROI/ ((Stock Bid or input cost + Put Bid)share quantity)*
Target ROI	Target Return on Investment shows in Dollars the return if the target price is reached at expiration. The Target price can be any price the stock could reach, and could be used to see what the profit or loss would be at that target price. Calculations: If stock would be assigned, uses the Max Gain calculations above If stock is unchanged, uses the Static ROI calculation above If stock price changes, Call Calculation: Call Bid +/– difference in stock Ask or input cost to target price Put Calculation: Put Bid +/– difference in stock Bid or input cost to target price
% Target ROI	The Target Return on Investment expressed as a % Call Calculation: Target ROI / ((stock Ask or input cost – Call Bid) share quantity)* Put Calculation: Target ROI/ ((Stock Bid or input cost + Put Bid) share quantity)*
Break Even	The price the stock could reach at expiration where the profit or loss is 0 for the strategy based on the inputs. Assumes a profitable transaction, so when a profit is not possible, shows “—“. Call Calculation: Ask price of stock or input cost – Call Bid Price Put Calculation: Bid price of stock or input cost + Put Bid Price
% Protection	Due to the nature of Covered Call and Covered Put strategies, there is a degree of hedging that takes place by selling the option against the stock position. Call Calculation: Call Bid/stock Ask or input cost 100* Put Calculation: Put Bid/Stock bid or input cost 100*

Quote Data
Strike	Option strike price; the price at which the owner of an option can purchase (call) or sell (put) the underlying security
Symbol	Stock, option, or index symbol
Last Trade	Price of last trade
Change	Change from Previous Close to Last Trade
Bid	Current inside Bid price
Ask	Current inside Ask price
Midpoint	Midpoint between Bid and Ask
Volume	Number of shares/contracts the security has traded for the day
Bid Size	The quoted size of the inside bid price
Ask Size	The quoted size of the inside ask price
Open Int	Open Interest is the total number of outstanding options contracts that have not yet been closed
% Change	Percent change from Previous Close to Last Trade
Last Size	Size of last trade
Last Time	Time of last trade
Chg (Open)	Change from Open to Last Trade
% Chg (Open)	Percentage change from Open to Last Trade
Open	Opening price for the day
High	Highest price the security has traded at for the day
Low	Lowest price the security has traded at for the day
Prev Close	Closing price from previous market session
Ending Ask	Ending Ask price of the market session
Ending Bid	Ending Bid price of the market session
Ending Mid	Ending Midpoint price of the market session
Intrinsic Value	The value by which the option is in the money, calculated for calls as (underlying price – strike price), or for puts as (strike price-underlying price)
Time Value	The value of the option that is not attributed to the intrinsic value, calculated as (Midpoint - Intrinsic Value)

Greeks
IV	Implied Volatility based on the option midpoint price and underlying price as calculated with selected option pricing model. IV is a theoretical value (in %) designed to represent the forecasted volatility of the security or index as determined by the prices of multiple call and put options using the Black-Scholes pricing model. Other variables usually include security price, strike price, risk-free rate of return, and days to expiration. If all other variables are equal, the security with the highest volatility will generally have the highest option prices.
IV Ask	Implied Volatility based on the option ask price and underlying price as calculated with selected option pricing model.
IV Bid	Implied Volatility based on the option bid price and underlying price as calculated with selected option pricing model.
Delta	Estimate of the change in option price per one point change in the underlying price based on the selected option pricing model.
Gamma	Measures the change in delta for a change in the underlying security price
Theta	Estimate of the change in option price per one day passing based on selected option pricing model.
Vega	Estimate of the change in option price per a 1% change in volatility of the underlying based on selected option pricing model.
Rho	Estimate of the change in option price per a 1% change in interest rates based on selected option pricing model.

Commissions, taxes, and transaction costs are not included in any of these strategy discussions, but can affect final outcome and should be considered. Please contact a tax advisor to discuss the tax implications of these strategies. Many of the strategies described herein require the use of a margin account. With long options, investors may lose 100% of funds invested. In-the-money long puts need to be closed out prior to expiration, since exercising them could create short stock positions.

Options carry a high level of risk and are not suitable for all investors. Certain requirements must be met to trade options through Schwab. Multiple leg options strategies will involve multiple commissions. Spread trading must be done in a margin account. Please read the options disclosure document titled "Characteristics and Risks of Standardized Options."