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Option Profit Calculator
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Version
1.0.0
Option Profit Calculator is a software program for
Windows computers that helps you compare stock and
option transactions. It allows you to input
information about the transactions such as purchase
and sale (or execution) dates, purchase and sale
prices, and so on. It gives you the actual profit from
the transaction if the transaction goes as expected
and the potential loss in a worst case scenario. More
important, it also gives you an annualized profit,
both in terms of dollars and in terms of percentages
of your investment, and an annualized potential loss.
For example, sell an option for $1.00 that expires in
two months and allow it to expire. Your profit would
be $100 (because one option actually controls 100
shares) minus your commission fees. If your commission
fees were $11.00 flat fee plus $2.00 per option, your
profit would be $87.00. Your annualized profit on this
two-month transaction would be $87.00 X 6 = $522.00.
Assume you needed to have $50.00 on hand to cover the
option. This $50.00, plus your $13.00 commission fees,
are your total investment. Your rate of return would
be $522.00/$63.00, or 8.29% annual rate of return.
Because Option Profit Calculator provides profit and
loss information in an annualized format, you can
easily compare stock or option transactions for
various time periods and various investments. How does
selling a one-month call compare to a two-month call?
How does buying the stock and selling a covered call
compare to a naked call? How does the option on a $100
stock compare to the option on a $10 stock? Option
Profit Calculator automatically calculates the profit
of the transaction, the time duration your money is
tied up, and even factors in your commission fees. It
gives you very fast calculations of complex problems.
It even stores previous calculations and allows you to
see them all together for easy comparisons, and it
will print the results if you find that more
convenient.
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