Option Price Calculator

The Option Price Calculator allows users to calculate the price and Greeks (Delta, Gamma, Theta, Vega, Rho) of call and put options using the Black-Scholes model based on inputs like spot price, strike price, time to expiry, risk-free rate, and volatility.

Use Our Option Price Calculator

Step-by-Step Guide to Using the Option Price Calculator

Getting Started

Utilize the Option Price Calculator to estimate the price of options and various option greeks using the Black-Scholes model. Follow the steps below to input the necessary data and obtain your results.

Inputting Required Data

  1. Spot Price ($):

    Enter the current stock price. This field is mandatory, and the value must be greater than or equal to $0.01.

  2. Strike Price ($):

    Input the strike price as per the option contract. This field is also mandatory, and the value must be greater than or equal to $0.01.

  3. Time to Expiry (Years):

    Specify the time remaining until the option expires, in years. It should be between 0.01 and 10 years, with a precision of 0.01 years.

  4. Risk-Free Rate (%):

    Enter the annual risk-free interest rate, which must fall between 0% and 100%, with a precision of 0.01%.

  5. Volatility (%):

    Indicate the annual volatility, ranging from 0% to 200%, with 0.01% increments.

  6. Option Type:

    Select either a ‘Call Option’ or a ‘Put Option’ from the dropdown menu. This selection is required to determine the correct pricing model.

Viewing the Results

Once all the required fields are accurately completed, the calculator will automatically compute the following values:

  • Option Price:

    Calculated using the Black-Scholes formula, this reflects the theoretical price of the option. The result is displayed as USD currency, rounded to two decimal places.

  • Delta:

    This metric indicates how much the option’s price will change with a $1 change in the spot price. It is calculated with precision up to four decimal places.

  • Gamma:

    Gamma reflects the rate of change in Delta with respect to changes in the underlying asset’s price, rounded to four decimal places.

  • Theta:

    Theta estimates the rate of decline in an option’s value due to the passage of time, presented to four decimal places.

  • Vega:

    Vega measures sensitivity to volatility changes, providing insight on how the option’s price is affected by changes in volatility, displayed with four decimal precision.

  • Rho:

    This reflects the sensitivity of the option price to changes in the interest rate, calculated with four decimal places of accuracy.

Final Remarks

Ensure all data entered is precise and corresponds to the current market conditions for the most accurate assessments. Use these metrics to inform your trading decisions and risk management strategies.