Understanding the Inputs

• Current Stock Price ($): The current market price of the underlying stock.
• Strike Price ($): The price at which the option contract can be exercised.
• Price Paid (Premium per share, $): The cost you paid per share for the option contract. Multiply this by 100 to get the total premium paid for one contract.
• Option Type: Select whether you are analyzing a "Call" option (gives the right to buy) or a "Put" option (gives the right to sell).
• Expiration Date: The date on which the option contract expires.
• Delta: Measures the option's price sensitivity to a $1 change in the underlying stock price. For calls, Delta is positive; for puts, it's negative.
• Gamma: Measures the rate of change of Delta with respect to changes in the underlying stock price. It indicates how much Delta will change for a $1 move in the stock.
• Theta: Measures the option's time decay. It represents how much the option's value will decrease per day as it approaches expiration. Theta is typically a negative value.
• Vega: Measures the option's price sensitivity to a 1% change in the underlying stock's implied volatility.
• Rho: Measures the option's price sensitivity to a 1% change in the risk-free interest rate. Its impact is usually less significant for short-term options.
• Time Change (Days or DTE): This represents the number of days that pass from the current date for the projection. This is also known as "Days to Expiration" (DTE) when calculating time decay.
• Stock Price Change ($): The amount by which the underlying stock price is expected to change (up or down) for projection scenarios.
• Volatility Change (%): The percentage point change in implied volatility for projection scenarios (e.g., enter 1 for a 1% increase in volatility).
• Market Price ($): The current price of the stock at which you are considering buying or shorting.
• Amount of Shares: The number of shares you intend to buy or short.
• Target Price ($): The price at which you expect to sell (if buying) or buy back (if shorting) the shares.