With the SAMCO Option Fair Value Calculator calculate the fair value of call options and put options. This tool can be used by traders while trading index options (Nifty options) or stock options.
This can also be used to simulate the outcomes of prices of the options in case of change in factors impacting the prices of call options and put options such as changes in volatility or interest rates.
A Trader should select the underlying, market price and strike price, transaction and expiry date, rate of interest, implied volatility and the type of option i.e. call option or put option and accordingly evaluate the output.
Theoretically, the buyer of a Call option has a RIGHT to BUY the underlying at a pre-determined price. Buyers of call options expect the price of the underlying to appreciate. Sellers of a call option have an obligation to deliver the underlying and are subject to unlimited risk due to which option selling/writing attracts margin. Theoretically, Buyers of Call Options can make unlimited profits as stocks can rise to any level, while call option writers make profit limited to the premium received by them. The buyer of a Put option has a RIGHT to SELL the underlying at a pre-determined price. Buyers of put options expect the price of the underlying to depreciate. Sellers of a put option have an obligation to TAKE DELIVERY of the underlying at a pre-determined price. Put option writing also requires margin to be paid by the option writer. Theoretically the buyer of the Put option can make a profit limited to the spot price of the underlying less Premium paid, say for example, A Ltd is trading for Rs.105, You buy a Put contract of A with strike price 100, paying Rs.2 as premium. Stock price of A falls to zero, you make a profit of Rs.98 (Strike Price less Premium Paid, i.e. Rs.100-Rs.2). The profit of the Seller of put options is limited to the premium received by them.
In India, options are cash-settled and not settled via actual delivery of the underlying.
Why Trade Options with SAMCO?
Unlike Traditional brokers who charge brokerage per lot purchased or sold, with a Discount Broker like SAMCO, you pay brokerage on the number per transaction!
To put it simply, say you buy 20 lots of call options on the NIFTY in one order. With SAMCO, your brokerage will be Rs.20 for the entire order.
You can calculate your savings with the Brokerage Calculator.
Disclaimer : The SAMCO Options Price Calculator is designed for understanding purposes only. It’s intention is to help option traders understand how option prices will move in case of different situations. It will help users to calculate prices for Nifty options (Nifty Option calculator for Nifty Option Trading) or Stock options (Stock Option Calculator for Stock Option Trading) and define their strategies accordingly. A user should use the output of this calculator at their own risks and consequences and SAMCO would in no way be held responsible for use of the same.