Samco securities limited

Option trading is a highly rewarding way to supercharge your returns!

Calculate Fair Values of Call options and Put options for Nifty Options and a wide range of other Index and Stock options listed on the National Stock Exchange in India

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.

Stock / Underlying

Current Market Price

Current Market Price

Exercise Price/Strike Price *

Date of Transaction

Expiration Date*

Rate of Interest (%)

Reference Historic Volatility (%)

Option Type

102.55
Value of Call

Value of the Option when the Price of the Underlying Changes

This is a graphical representation of the possible option prices when the price of the underlying stock/contract changes assuming other factors such as time, volatility and interest rates remain same. This will help you judge the upside and downside for the option value when the price of the stock/underlying changes.

In the Current Example - All other factors remaining constant, the Call would be valued at 398.12 in case the price went up to 14772.75 and in case the price went down to 14196.75, the fair value would be 84.38.

Impact of Time on value of Option

As a general rule, the option value falls as the option approaches its expiry. This graph explains how the value of the option would fall as the time moved towards Expiry assuming all other factors i.e. Underlying Price, Volatility and Interest rate remaining the same.

In the current case, the Value of the option would fall to 0 on the Expiry Date 28-01-2021 assuming that the price of the stock/contract and the IV remained the same.

Impact of Change in Volatility on Value of Option

As a general rule, if the Implied volatility (i.e. expected volatility) is greater, the option value will be higher and vice versa.

Option values will be higher if the IV is greater and vice versa. You should remember that the IV’s are usually high ahead of any specific event or announcement and fall after the same and hence option prices may not move exactly the same way as the stock/contract does due to the change in the IV.

In the current case, if the IV went up from the current levels of 15% to 20%, the value of the option would go up to 266.40 and in case the IV went down to 10%, the value of the option would go down to 146.39.

Value of Option when the Interest Rate Changes

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.

Open a free
Samco trading and demat account today!

Trade & invest online in stocks, future & options, mutual funds, IPOs, mini portfolios and more with an award-winning stockbroker Samco. Get 100% brokerage cashback for 1st month

Open a Demat Account For FREE with Samco – India’s Best Stockbroker

Trade and invest with Samco @ flat Rs.20/order

Or log in to complete your existing account opening application