Covered Call Calculator

Type in a ticker and your cost basis — that's the price you paid for shares, minus any premiums you've already collected from prior CSP or CC cycles. The calculator pulls live options data and shows you static return, if-called return, downside protection, breakeven, and delta for any strike you pick.

The strike comparison table is the fastest way to find the right call. It lines up multiple strikes side by side. Higher strikes pay less premium but give your stock more room to run. Enter your cost basis accurately — the calculator flags any strike below it so you don't accidentally lock in a loss without realizing it.

The payoff diagram shows your P&L at every stock price at expiration. The flat line is your max profit (the premium). The slope to the left of breakeven shows how much downside protection the premium gives you. It's not much, but it's something.

Here's when I pull up this calculator:

• Just got assigned on a CSP: First thing I do is find the best CC strike to start generating income on my new shares. Every call premium lowers my cost basis further.
• Comparing weeklies vs. monthlies: A 14-day call might pay less in absolute premium but have a higher annualized yield than a 30-day call. This calculator makes that comparison obvious.
• Thinking about closing early: Check what's left in your current call, then use the Exit Analysis Calculator to see if closing and selling a fresh one makes more money.
• Considering a roll: Model the new call here first to compare yield and breakeven, then use the Roll Calculator to run the full comparison.

A covered call is straightforward. You own 100 shares and you sell someone the right to buy them at a higher price. They pay you premium for that right. If the stock stays below your strike, the call expires worthless — you keep the shares and the premium. If it goes above, they take your shares at the strike and you keep the premium on top.

It's the second leg of the wheel. After you get assigned on a CSP and own shares, this is how you keep collecting income while you wait.

Two Return Scenarios

Static return is what you earn if the stock goes nowhere — just premium divided by share price. If-called return adds the capital gain from selling at the strike. Example: bought at $100, sold a $105 call for $2.00. Static return is 2%. If-called return is 7% ($2 premium + $5 gain). The calculator annualizes both so you can compare a weekly to a monthly on equal footing.

The Tradeoff You're Making

You're capping your upside. If the stock rips 20% past your strike, you don't get that. You get the premium plus gains up to the strike. That's the deal. For income traders, it's worth it — you're selling volatility, not chasing moonshots. I sell at 0.25–0.35 delta, 30–45 DTE. If shares get called away, I cycle back to selling CSPs. That's the wheel.

If Called Away: Completing the Wheel

Stock rises past your strike at expiration? Your shares are gone — sold at the strike price. Your total return is the capital gain (strike minus cost basis) plus every premium you've collected from CSPs and covered calls. This is the ideal exit. It's what you're working toward the whole time.

Now you've got cash again. Sell a new CSP on the same stock if you still like it, or rotate to something with better premium. The wheel keeps turning.

When to Roll a Covered Call

Rolling means buying back your current call and selling a new one — usually further out in time, sometimes at a different strike. I consider rolling when:

• The call's about to expire ITM and I want to keep my shares
• I can roll out and up for a net credit — getting paid to adjust
• IV has dropped — close cheap now, re-sell when IV picks back up
• The stock blew past my strike — roll up to capture more upside

Use the Roll Calculator to compare keep vs. roll before you pull the trigger.

Learn the full Wheel Strategy →