Short Call Calculator
Visualize the profit and loss for any short call option.
Option Parameters
Key Metrics
Enter parameters and calculate to see results.
Enter parameters and calculate to view P/L chart
Free 160-Page Options Guide
Clear visuals and real examples for every essential concept.
What Is a Short Call?
A short call is selling a call option without owning the underlying shares. You collect a premium upfront and profit if the stock stays below the strike through expiration. If the stock rises above the strike, losses can increase indefinitely.
This is also called a "naked" short call—there are no shares to deliver if assigned, unlike a covered call.
What Is a Short Call? — Full strategy guide with examples
Key Characteristics
- Max Profit: Premium received. Achieved when the option expires worthless (stock ≤ strike).
- Max Loss: Unlimited. The stock can rise indefinitely.
- Breakeven: Strike + premium received
- Outlook: Bearish to neutral
How to Read the P/L Chart
The white line (Expiration) shows P/L at expiration. Below the strike, you keep the full premium. Above the strike, losses grow with no cap.
The cyan line (T+0) shows theoretical P/L at entry. The gap between lines represents time decay yet to be captured. As expiration approaches, T+0 converges toward the expiration line.
Using This Calculator
- Stock Price: Current price at trade entry
- Strike Price: The price you're obligated to sell shares if assigned
- Premium: Credit received for selling the call. Multiply by 100 for the total credit per contract.
- Days to Expiration (DTE): Time until the option expires
- Implied Volatility (IV): The market's expected price movement
Short Call vs Covered Call
A covered call pairs a short call with 100 shares you already own. The shares act as collateral—if assigned, you deliver your shares at the strike. A naked short call has no protection: if the stock rallies, you buy back the call at a higher price than you sold it.
Combined with shares, the short call becomes a conservative income strategy. Without shares, it's one of the riskiest positions in options trading.
Assignment Risk
If the option is ITM at or before expiration, you may be assigned and must deliver 100 shares at the strike price. Without shares, you'll buy at the market price—potentially far above the strike.
Early assignment is rare, but becomes likely when:
- The option is deep ITM with little extrinsic value
- An ex-dividend date approaches and the extrinsic value is less than the dividend
Naked Short Calls vs Bear Call Spread
Short calls are only suitable for experienced traders. For most traders, bear call spreads offer similar exposure with defined risk.
Related Calculators
- Long Call Calculator — Buy a call instead of selling one
- Bear Call Spread Calculator — Defined-risk bearish alternative
- Covered Call Calculator — Bullish strategy combining a short call with long stock
- Cash-Secured Put Calculator — Shorting puts for income while waiting to buy stock
