If you were to purchase 100 shares of Google at current prices it would cost about $222,000. With an option spread you can control 100 shares of Google for $350. One of the big advantages to trading option spreads is that spreads allow you to trade high price stocks like Amazon, Google, or Netflix for as little as $350. Trade High Priced Stocks for $350 With Less Risk Interested in accessing the Optioneering Calculators? Join one of Chuck’s Trading Services for unlimited access! The Optioneering Team has option calculators for six different option strategies that allow you to calculate the profit potential for an option trade before you take the trade. The Hughes Optioneering Team is here to help you identify winning trades just like this one. Option spread trades can result in a higher percentage of winning trades compared to a directional option trade if you can profit when the underlying stock/ETF is up, down or flat.Ī higher percentage of winning trades can give you the discipline needed to become a successful trader.
#Stock profit calculator etf free
Ready to start investing Get your free personalised portfolio recommendation. See the power of compound growth over time. Enter how much you’ll start with, a regular top-up amount and a growth rate. The analysis reveals that if DDS stock is flat or up at all at expiration the spread will realize a 102% return (circled).Īnd if DDS stock decreases 7.5% at option expiration, the option spread would make a 102% return (circled).ĭue to option pricing characteristics, this option spread has a ’built in’ 102% profit potential when the trade was initiated. Discover how compound growth works when you invest your money. The maximum risk for an option spread is the cost of the spread. The prices and returns represented below were calculated based on the current stock and option pricing for DDS on before commissions.įor this option spread, the calculator analysis below reveals the cost of the spread is $495 (circled). Out of fairness to our paid option service subscribers we don’t list the option strike prices used in the profit/loss calculation.
The goal of this example is to demonstrate the ’built in’ profit potential for option spreads and the ability of spreads to profit if the underlying stock is up, down or flat at option expiration. The Call Option Spread Calculator will calculate the profit/loss potential for a call option spread based on the price change of the underlying stock/ETF at option expiration in this example from a 7.5% increase to a 7.5% decrease in DDS stock at option expiration. Now, since DDS’s Monthly Price is currently trading above the 10-Month SMA and will likely rally from here, let’s use the Hughes Optioneering calculator to look at the potential returns for a DDS call option spread.
0 kommentar(er)
