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Description
Option Profit Calculator is a software program for Windows computers that helps you compare stock and option transactions. It permit you to input knowledge about the transactions such as purchase and sale (or execution) dates, purchase and sale prices, and so on. It gives you the actual profit from the transaction if the transaction goes as expected and the potential loss in a worst case scenario. further important, it also gives you an annualized profit, both in terms of dollars and in terms of percentages of your investment, and an annualized potential loss. For example, sell an option for $1.00 that expires in two months and allow it to expire. Your profit would be $100 (because one option actually controls 100 shares) minus your commission fees. If your commission fees were $11.00 flat fee plus $2.00 per option, your profit would be $87.00. Your annualized profit on this two-month transaction would be $87.00 X 6 = $522.00. Assume you needed to have $50.00 on hand to cover the option. This $50.00, plus your $13.00 commission fees, are your total investment. Your rate of return would be $522.00/$63.00, or 8.29% annual rate of return. Because Option Profit Calculator provides profit and loss knowledge in an annualized format, you can simply compare stock or option transactions for various moment periods and various investments. How does selling a one-month call compare to a two-month call? How does buying the stock and selling a covered call compare to a naked call? How does the option on a $100 stock compare to the option on a $10 stock? Option Profit Calculator automatic calculates the profit of the transaction, the moment duration your money is tied up, and even factors in your commission fees. It gives you very fast calculations of complex problems. It even stores previous calculations and permit you to see them all together for facile comparisons, and it will print the results if you find that further convenient.
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