What is the profit or loss on a long call option held to expiry?
A long call held to expiry is worth the amount, if any, by which the underlying price exceeds the strike. Net profit then subtracts the premium paid for all contracts.
Intrinsic value minus premium cost
Intrinsic value = max(0, Price at expiry − Strike)Profit per share = Intrinsic value − PremiumTotal = Profit per share × Contracts × 100Break even = Strike + PremiumOne call position at expiry
The default example treats each contract as 100 shares and calculates intrinsic value at expiry. Premium cost is deducted to show the net result and break-even underlying price.
Illustrative inputs; currency amounts below use USD. Rates and prices are assumptions, not live quotes.
- Strike price
- $50.00
- Premium paid per share
- $2.40
- Contracts
- 1
- Price at expiry
- $58.00
Step-by-step calculation
- At expiry, call intrinsic value per share = max(0, 58 − 50) = 8.
- Subtract the premium of 2.4 per share, then multiply by 1 contracts × 100 shares: total profit 560.
- Break-even underlying price = 50 + 2.4 = 52.4. This is an expiry payoff, not a pre-expiry option valuation.
Intermediate figures are rounded for reading. Results use the full calculation precision.
Strike, break-even and maximum premium loss
Below the strike, expiry value is zero and the premium is lost. Above the strike, intrinsic value grows dollar for dollar per underlying share, but profit begins only after the premium is recovered.
Why this is not a live option-pricing model
This model is only for a purchased long call held to expiry. It cannot price an option before expiry because time value and implied volatility are not included.
- Each option contract represents 100 underlying shares.
- The call is purchased and held until expiry without early exercise or sale.
- Commission, assignment, dividends, volatility and time value are excluded.
Calculations related to long call option profit
The following tools examine neighbouring parts of the same calculation without changing the inputs or assumptions used above.
References
Sources and conventions
- SEC Investor.gov: option contracts
Explains calls and premiums. This tool covers only a purchased call at expiry with a 100-share contract multiplier.
Quick answers
Frequently asked questions
What is the break-even price for a long call at expiry?
The calculator adds the premium paid per share to the strike price.
What is the maximum loss on a long call?
Under this expiry-only calculation, maximum loss is the premium paid: premium per share multiplied by contracts and 100.
Can this calculator value a call option before expiry?
No. It covers only a purchased long call held to expiry and uses expiry intrinsic value, not an options-pricing model.
Why does each contract multiply the result by 100?
The calculation assumes the standard contract size of 100 shares per option contract.
Calculation method and limitations · Report an error
Educational content only. This guide is not financial advice.