Options Calculator
Calculate the theoretical price of a European call or put option using the Black-Scholes model. Input stock price, strike price, time to expiration, risk-free rate, volatility, and dividend yield.
Published by:
isCalculator Editorial Team
Was this calculator helpful?
How to use this tool?
Options Calculator uses the Black-Scholes model to price European call and put options. Follow these steps:
- Select Option Type: Choose Call (right to buy) or Put (right to sell).
- Enter Stock Price ($): Current price of the underlying asset (positive number).
- Enter Strike Price ($): Price at which the option can be exercised (positive number).
- Enter Time to Expiry (years): Fractional years until expiration (e.g., 0.5 for 6 months). Must be positive.
- Enter Risk-Free Rate (%): Annual risk-free interest rate (e.g., 5 for 5%). Can be zero, but not negative.
- Enter Volatility (%): Annualized standard deviation of stock returns (e.g., 20 for 20%). Must be positive.
- Enter Dividend Yield (%): Annual dividend yield (e.g., 0 for none). Can be zero, but not negative.
- Click "Calculate Option Price": The result shows the option's fair value in dollars and the Black-Scholes d1/d2 values.
Note: All inputs must be valid numbers. The calculator validates positive values where required and shows error highlights if invalid.
Previous Results
| Result | Inputs | Date |
|---|
Frequently Asked Questions
The Black-Scholes model is a mathematical model used to estimate the theoretical price of European-style options. It takes into account factors like stock price, strike price, time to expiration, risk-free rate, volatility, and dividends.
No, this calculator uses the Black-Scholes model which is designed for European options that can only be exercised at expiration. American options may have different pricing due to early exercise features.
The dividend yield is the expected annual dividend rate of the underlying stock. If the stock pays no dividends, enter 0.
