Premium yield, annualized return, profit if the shares are called away, breakeven, and downside protection. It runs in your browser. No account and no sign-in.
Shares and contracts stay in step: one contract covers 100 shares. Premium is per share. Yield and protection are measured against your cost basis, not today's stock price.
OptionsLoop keeps the covered call on the same wheel as the cash-secured put that produced the shares, so premium from both legs lowers one cost basis.
Track your wheel trades freeA covered call sells someone else the right to buy shares you already own, at the strike, before expiration. You are paid a premium for that. If the stock stays below the strike you keep the shares and the premium. If it finishes above the strike, the shares are called away: you sell at the strike, and you still keep the premium. The premium is also a cushion if the stock falls.
You own 100 shares with a $52 cost basis and sell a $55 call for $1.10 a share. These are the numbers already filled in above.
If the call strike were $48 instead, called-away profit would be negative. You would be agreeing to sell below your basis, and the $1.10 premium would not cover the $2 gap. The calculator shows that loss rather than hiding it inside the premium.
Two people can sell the same call and get different yields, because yield here is premium divided by what you paid. A wheel trader who was assigned at $50 and has already collected $1.20 of put premium might enter a cost basis of $48.80. That is the figure from the cost-basis guide, and it is what the wheel strategy calculator carries from the put into the call. Someone who bought the shares at $52 today should use $52. Say which one you mean when you quote the yield.
Premium yield is the net premium divided by the cost of the shares (cost basis per share times the number of shares). This calculator uses your cost basis, not the current stock price, so the yield is income relative to what you paid. Using the market price instead answers a different question: the return on what the shares are worth today.
Downside protection is how far the stock can fall before the premium is used up. In dollars per share it equals the net premium. As a percent it equals that premium divided by your cost basis. The breakeven price is your cost basis minus the premium per share. Below that price the position loses money, even though you kept the premium.
You sell the shares at the strike. Profit if called away is the stock gain or loss from your cost basis up to that strike, plus the premium. If the strike is below your cost basis, that number can be negative: assignment locks in a loss, and the premium only partly offsets it. Upside past the strike is given up.
Annualized return multiplies the premium yield by 365 divided by days to expiration. A handful of days in the denominator turns a small premium into a large annualized figure. Use it to compare trades of different lengths, not as a prediction of what the account will earn.
This calculator is educational content, not financial advice. It does not recommend a trade, and it does not predict whether a call will expire or be assigned. Selling a covered call caps the upside on the shares and does not remove the downside past the premium you collected. OptionsLoop is a tracking tool, not a broker or investment adviser. Examples use made-up prices.