Covered call calculator
Model a covered call — long stock plus a short call for income — and see its payoff diagram instantly: the premium you collect, the capped upside above the strike, your breakeven, and the cushioned downside. Adjust the strike, premium, and cost basis and watch it update live.
What it shows
Premium income
The credit you collect for selling the call against your shares.
Capped upside
Profit flattens above the strike — the shares can be called away.
Breakeven
Your cost basis minus the premium collected.
Downside cushion
The premium offsets part of a decline, but stock risk remains.
How to use it
- 1. Open the builder — it starts you with long stock and a short call on live data.
- 2. Set the call strike (how much upside you’re willing to cap).
- 3. Adjust the premium and your stock cost basis.
- 4. Read the payoff: income, breakeven, max profit, and downside update live.
Common questions
How do I calculate covered call return and breakeven?
Breakeven is your stock cost basis minus the premium collected. Max profit is the call strike minus your cost basis, plus the premium — reached if the stock is at or above the strike at expiration. Below breakeven you lose money, cushioned by the premium.
What is the downside of a covered call?
You cap your upside above the strike (the shares can be called away), and you still carry the stock’s downside — the premium only cushions part of a decline. It is a mildly bullish to neutral, income strategy.
Is the covered call calculator free?
Yes. You can model the stock-plus-short-call position and read its payoff for free. An account is only needed to save a strategy.
Is this financial advice?
No. ThetaViz is an educational visualization tool. It does not provide financial advice or recommendations.
Learn the concepts
The income-strategy concepts behind the covered call.
Covered Call: Income on Stock You Own
Sell a call against shares you own to collect premium and cap upside.
Cash-Secured Put: Getting Paid to Wait
Sell a put with cash reserved to buy stock at the strike if assigned.
Call Options Explained
Call options: right to buy at the strike, payoff at expiration, breakeven, delta, and when buyers vs sellers use calls.
Collar: Capping Upside to Limit Downside
Long stock, long put, and short call combined for a defined risk range.
Keep exploring
Compare it with the full options payoff calculator, model an iron condor, or read the free guides.
ThetaViz is an educational visualization tool. Market data is for educational use only and this is not financial advice.