Put Option Cost Calculator
Calculate the total cost and breakeven price of buying a put option.
See your maximum profit, maximum loss, and breakeven point.
How Put Option Cost Works
A put option gives the buyer the right — but not the obligation — to sell 100 shares of stock at the strike price before the expiration date. Traders buy puts to profit from price declines or to hedge long stock positions.
Total put cost formula:
Total Premium = Option Premium per share × 100 (shares per contract)
Worked example:
- Stock: XYZ trading at $85
- Put option: $80 strike, 45 days to expiration
- Option premium: $2.30 per share
Cost per contract = $2.30 × 100 = $230
This is the maximum you can lose — the premium paid.
Maximum profit at expiration:
Max Profit = (Strike Price − Premium) × 100
If stock falls to $0:
Max Profit = ($80 − $2.30) × 100 = $7,770 per contract
Break-even price:
Break-even = Strike Price − Premium Paid = $80 − $2.30 = $77.70
The stock must fall below $77.70 at expiration for the put to be profitable.
Put option pricing factors (Black-Scholes inputs):
- Intrinsic value: Max(Strike − Stock Price, 0), an $80 put on an $85 stock has $0 intrinsic value (out-of-the-money)
- Time value: Premium remaining above intrinsic value, decays as expiration approaches (theta decay)
- Implied volatility (IV): Higher IV = more expensive options (vega)
Put as portfolio hedge:
Hedge ratio = Portfolio value ÷ (Stock price × 100)
To hedge a $50,000 portfolio against a $85 stock:
Contracts needed = $50,000 ÷ ($85 × 100) ≈ 6 contracts
Buying 6 put contracts creates a floor — the portfolio is protected below the strike minus premiums paid.
How we build and check this calculator
This calculator runs entirely in your browser, so the numbers you enter stay on your device. The math behind it is written by hand and tested against worked examples and standard references before the page goes live.
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