The online options profit calculator can help you with the required understanding of maths and the dynamics of an option play from opening it until it is closed and whether it is profitable. So, an option play can be either long or short with one fixed leg (position).
Although, it can also be a spread with more than one leg (positions), or a more complex play with three legs or more, making it tougher.
A usual option play can be directional, non-directional or a bet on a price target, a trade mostly based on time decay or a change in volatility. An option calculator will help you understand the changes of the Greeks as the price action on the underlier changes.
The calculator can also be used to simulate the outcomes of prices of the options. This includes change in factors that have an impact on the prices of call options. It also puts options such as changes in volatility or interest rates in stock market trading.
It is advisable that a trader should select the following and accordingly evaluate the output:
- Underlying, market price and strike price
- Transaction and expiry date
- Rate of interest
- Implied market volatility (market fluctuations)
- The type of call option or put option